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Deutsche Bank Starts Bloomin’ Brands Coverage with ‘Buy’ Rating

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Jun. 28 2019, Updated 10:51 p.m. ET

Deutsche Bank’s rating

Today, Deutsche Bank initiated coverage of Bloomin’ Brands (BLMN) with a “buy” rating and a 12-month price target of $24, which implies an upside potential of 27.5% from its stock price of $18.82 on June 27.

As CNBC reported, Deutsche Bank stated, “The BLMN story largely boils down to whether or not it can execute on its long-term adjusted operating margin expansion targets set forth at its Investor Day in March. At present, consensus expectations for 2020 imply skepticism that the targets can be hit. In addition, at present, BLMN’s EV / EBITDA multiple screens cheap relative not only to its Casual Dining Peers, but also to its own five-year historical averages.”

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Other analysts’ recommendations

Since Bloomin’ reported its first-quarter earnings on April 26, analysts’ reactions were mixed. On May 24, Guggenheim upgraded the stock from “neutral” to “buy” and set a new price target of $25. However, on May 23, BMO downgraded the stock from “market perform” to “underperform” and cut its price target from $23 to $18.

Overall, analysts have a “buy” recommendation on the stock. 58.3% of the 12 analysts who follow the stock have a “buy” rating while 25% say “hold” and the remaining 16.7% have a “sell” rating. On average, analysts’ 12-month price target for BLMN stands at $22.64, which implies upside potential of 20.3% from its stock price of $18.82 on June 27.

Peer comparisons

Of the 28 analysts who cover Darden Restaurants (DRI), 60.7% have a “buy” rating while 35.7% say “hold” and the remaining 3.6% have “sell” recommendations. On average, analysts have a 12-month price target of $126.96, which implies upside potential of 4.5% from its stock price of $121.54.

Darden reported its fourth-quarter earnings for fiscal 2019 on June 20. Learn more in “Darden’s Stock Rose despite Weak Fiscal 2020 Guidance.”

Of the 22 analysts who cover Texas Roadhouse (TXRH), 54.5% have a “hold “rating while 31.8% recommend a “buy” rating and the remaining 13.6% have a “sell” rating. Analysts have a 12-month price target of $60.26, which implies an upside potential of 10.7% from the current stock price of $54.42.

Of the total analysts who follow Brinker International (EAT), 61.9% favor a “hold” rating while 23.8% have a “buy” rating and 14.3% have a “sell” rating. Analysts have a 12-month price target of $45.94, which implies an upside potential of 17.7% from its stock price of $39.04.

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