BLMN

Bloomin' Brands is a classic deep-value turnaround setup priced for skepticism. At $8.80, the stock trades at just 0.2x sales and a $750M market cap against $277M of operating cash flow (FY2025, +21.3% YoY) — a 37% OCF yield that screams cheap. The balance sheet is also notably better than headline P/E suggests: long-term debt dropped 23.4% to $787M, stockholders' equity rebuilt 146% to $334M, and capex moderated 18.5% to $180M. Management's November 2025 turnaround announcement and the October 2025 dividend suspension signal a credible pivot toward debt paydown and refreshing the existing Outback-led base rather than chasing growth.

But the operating reality is ugly. Revenue was essentially flat at $3.96B (+0.1%), operating income collapsed 73.4% from $139.8M to $37.2M, and operating margin compressed to 0.9% from 3.5%. Restaurant-level margin fell to 11.7% from 13.3%. The 88x P/E on $0.10 EPS is meaningless — earnings barely exist. U.S. comparable sales of +0.2% and Outback comps of -0.5% confirm the brand has lost relevance in a value-conscious casual-dining market squeezed by labor and commodity inflation that MD&A explicitly flags. The retained earnings deficit of -$918M and 8.5x liabilities/equity ratio leave little margin for error if a recession hits discretionary dining.