After days of mystery, IHOP revealed on Monday that it is temporarily replacing the “P” in its name with “b” as part of a marketing campaign to promote its burgers. Investors who own shares of IHOP owner Dine Brands Global Inc (NYSE: DIN) are hoping the name change will help renew interest in the restaurant and maintain the stock’s 2018 momentum.
IHOP generated some buzz on social media last week when it announced that it would be changing its name to IHOb and encouraged customers to try to guess what the “b” could stand for. On Monday, IHOP said the name change is only temporary and that the “b” stands for burgers.
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The name change is part of IHOP’s push to highlight its lunch and dinner menus and expand outside of its traditional breakfast brand. As part of the new campaign, IHOP will be adding several new non-breakfast menu items, including a Big Brunch burger.
Customers who love the traditional IHOP breakfast offerings have no reason to panic over online photos of IHOP signs being replaced by IHOb signs. “We are definitely going to be IHOP,” IHOP president Darren Rebelez says in a statement. “But we want to convey that we are taking our burgers as seriously as our pancakes.”
Rebelez said the majority of IHOP’s restaurants throughout the country will not undergo the temporary name change.
IHOP Corp. has been public since its initial public offering in 1961, but the company restructured in 2007 after it acquired Applebee’s International in a $2.1 billion deal. Today, both Applebee’s and IHOP are subsidiaries of publicly traded parent company Dine Brands.
Time will tell whether or not the publicity surrounding the IHOb name change will translate to more restaurant traffic. Even after a 28.7 percent gain so far this year, DIN stock has still lost roughly a third of its value over the past three years.
Earlier this year, Raymond James’ analyst Brian Vaccaro said new Dine Brands CEO Steve Joyce should get much of the credit for the recent turnaround. Vaccaro said new Applebee’s value promotions, including $1 alcoholic drinks, have really resonated with customers.
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Raymond James is projecting Dine Brands earnings will grow from $5 to $7 in 2019.
The firm has an “outperform” rating and $92.50 price target for DIN stock.
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IHOb Name Change Generates Buzz For Dine Brands Global Inc (DIN) Stock originally appeared on usnews.com
