Restaurant Stock Gets Monster Price Target

Wedbush sees more than 50% upside for the shares

Applebee's and IHOP parent Dine Brands Global Inc (NYSE:DIN) is in focus this morning following a very bullish note out of Wedbush. The brokerage firm started coverage on the equity with an "outperform" rating and $120 price target. DIN shares were last seen trading up 2.9% at $78.50, so this price target is calling for a nearly 53% rise in the security. It also represents record-high territory for DIN, which hit an all-time peak of $114.23 back in 2015.

To gain back to these levels, Dine Brands will need to conquer its 50-day moving average that has been acting as resistance so far this year. The shares are also trading in line with another closely watched trendline in the 200-day moving average, while their late-December pullback was neatly contained by the 320-day.

Short sellers have been jumping on DIN, however. The number of shorted shares rose by 16.7% in the last reporting period to 2.13 million, accounting for 12.3% of the total float. Going by average daily trading volumes, it would take these bears more than a week to cover their positions.

Meanwhile, other analysts share Wedbush's upbeat outlook. While there are only three other brokerage firms in coverage, they all recommend buying Dine Brands stock. Moreover, the average 12-month price target stands up at $108.80.