Looking back on sit-down dining stocks’ Q1 earnings, we examine this quarter’s best and worst performers, including Denny's (NASDAQ: DENN) and its peers.

Sit-down restaurants offer a complete dining experience with table service. These establishments span various cuisines and are renowned for their warm hospitality and welcoming ambiance, making them perfect for family gatherings, special occasions, or simply unwinding. Their extensive menus range from appetizers to indulgent desserts and wines and cocktails. This space is extremely fragmented and competition includes everything from publicly-traded companies owning multiple chains to single-location mom-and-pop restaurants.

The 12 sit-down dining stocks we track reported a mixed Q1. As a group, revenues beat analysts’ consensus estimates by 0.7% while next quarter’s revenue guidance was 2.3% below.

Luckily, sit-down dining stocks have performed well with share prices up 26.1% on average since the latest earnings results.

Denny's (NASDAQ: DENN)

Open around the clock, Denny’s (NASDAQ: DENN) is a chain of diner restaurants serving breakfast and traditional American fare.

Denny's reported revenues of $111.6 million, up 1.5% year on year. This print exceeded analysts’ expectations by 1.4%. Despite the top-line beat, it was still a slower quarter for the company with a significant miss of analysts’ EBITDA estimates and a miss of analysts’ EPS estimates.

Kelli Valade, Chief Executive Officer, stated, "The beginning of the year has presented significant challenges for consumers, which is evident in our results. Our teams have remained focused on executing against our strategic initiatives and winning with our guests, despite these macro headwinds. This included staying true to our Denny's flagship, by focusing on compelling value, being strategic in reaching new younger demographics through innovative partnerships and new menu offerings. Keke's continued to steal share in its home state of Florida while also growing to its seventh state, Georgia. The dedication of our teams and franchisees continue to push our brands forward and we remain committed to navigating these headwinds together."

The stock is up 10.7% since reporting and currently trades at $4.19.

Read our full report on Denny's here, it’s free.

Best Q1: Brinker International (NYSE: EAT)

Founded by Norman Brinker in Dallas, Brinker International (NYSE: EAT) is a casual restaurant chain that operates the Chili’s, Maggiano’s Little Italy, and It’s Just Wings banners.

Brinker International reported revenues of $1.43 billion, up 27.2% year on year, outperforming analysts’ expectations by 2.6%. The business had an exceptional quarter with a solid beat of analysts’ EBITDA estimates and an impressive beat of analysts’ same-store sales estimates.

Brinker International delivered the highest full-year guidance raise among its peers. The market seems happy with the results as the stock is up 7.7% since reporting. It currently trades at $173.00.

Is now the time to buy Brinker International? Access our full analysis of the earnings results here, it’s free.

Weakest Q1: First Watch (NASDAQ: FWRG)

Based on a nautical reference to the first work shift aboard a ship, First Watch (NASDAQ: FWRG) is a chain of breakfast and brunch restaurants whose menu is heavily-focused on eggs and griddle items such as pancakes.

First Watch reported revenues of $282.2 million, up 16.4% year on year, in line with analysts’ expectations. It was a softer quarter as it posted full-year EBITDA guidance missing analysts’ expectations.

As expected, the stock is down 16.6% since the results and currently trades at $15.50.

Read our full analysis of First Watch’s results here.

The ONE Group (NASDAQ: STKS)

Doubling as a hospitality services provider for hotels and resorts, The One Group Hospitality (NASDAQ: STKS) is an upscale restaurant company that operates STK Steakhouse and Kona Grill.

The ONE Group reported revenues of $211.1 million, up 148% year on year. This result beat analysts’ expectations by 3.8%. Taking a step back, it was a satisfactory quarter as it also recorded an impressive beat of analysts’ EPS estimates.

The ONE Group scored the biggest analyst estimates beat and fastest revenue growth among its peers. The stock is up 13.7% since reporting and currently trades at $3.53.

Read our full, actionable report on The ONE Group here, it’s free.

The Cheesecake Factory (NASDAQ: CAKE)

Celebrated for its delicious (and free) brown bread, gigantic portions, and delectable desserts, Cheesecake Factory (NASDAQ: CAKE) is an iconic American restaurant chain that also owns and operates a portfolio of separate restaurant brands.

The Cheesecake Factory reported revenues of $927.2 million, up 4% year on year. This number was in line with analysts’ expectations. Overall, it was a strong quarter as it also logged a solid beat of analysts’ EBITDA estimates and a decent beat of analysts’ EPS estimates.

The stock is up 13.8% since reporting and currently trades at $57.44.

Read our full, actionable report on The Cheesecake Factory here, it’s free.

Market Update

The Fed’s interest rate hikes throughout 2022 and 2023 have successfully cooled post-pandemic inflation, bringing it closer to the 2% target. Inflationary pressures have eased without tipping the economy into a recession, suggesting a soft landing. This stability, paired with recent rate cuts (0.5% in September 2024 and 0.25% in November 2024), fueled a strong year for the stock market in 2024. The markets surged further after Donald Trump’s presidential victory in November, with major indices reaching record highs in the days following the election. Still, questions remain about the direction of economic policy, as potential tariffs and corporate tax changes add uncertainty for 2025.

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