Bankruptcy Watch: 20 Riskiest Restaurant Stocks

Denny's

Altman Z-Score, Current: -0.45

Altman Z-Score, 2009: -0.38

Denny's(DENN) took the top spot -- or is it the bottom -- in TheStreet's ranking of restaurant stocks most likely to go bankrupt within two years. It earned a pitiful Z-Score of just -0.45 in the trailing-12 months, worse even than a score of -0.38 it earned in 2009.

Famous for its Moons Over My Hammy and Grand Slam offerings, the all-day breakfast chain said comps in the recent quarter decreased 6.2% at company-owned stores and 5.9% at franchised locations as the casual family-style restaurant segment continued to lose steam.

Revenue fell 13.3% to $135.1 million, and profits fell 40.9% to $5.5 million, or 5 cents per share.

Denny's, a well-known household name, is not done yet. Guest traffic did increase sequentially in each month of its recent quarter, representing its strongest guest count performance since the first quarter of 2009. It generated $3.3 million in cash proceeds from asset sales and reduced its outstanding debt by $10.0 million.

Denny's temporarily replaced CEO Nelson Marchioli with Debra Smithart-Oglesby in June after investors pushed to oust him, and this week tapped Robert Rodriguez, formerly COO of Pick Up Stix, as the new COO.

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