Outback Steakhouse

Bloomin' Brands  (BLMN - Get Report) shares were sliding 2.2% to $17.75 Tuesday after analysts with Deutsche Bank downgraded the casual dining chain company to hold from buy and cut their price target to $21 from $23.

Analysts Brian Mullan and Carlo Santarelli said in a note to investors that they downgraded the Tampa, Florida-based company, which operates the Outback Steakhouse, Bonefish Grill, and other restaurant chains, to reflect lackluster casual dining industry data throughout the third quarter.

"Stepping back from the quarter, and in light of recent softness in the government restaurant retail sales data and a most likely related deceleration in absolute job additions in the nonfarm payrolls data," the note said, "we have also taken a more conservative approach to our SSS estimates for 2020 and 2021."

Mullan and Santarelli lowered their blended third-quarter U.S. same-store-sales estimate for Bloomin' to up 0.6% from up 1.1%, below the current consensus of up 1.2%. 

"We are not downright negative, and still believe one could argue that there is relative (and potentially) strategic value here, especially in an industry where scale is taking on ever increasingly importance, and where there is a wide disparity of EV/EBITDA multiples across the group," the note said. "At (about)4 x lease-adjusted net debt to EBITDAR, however, there is also higher risk (relative to its peer group) of potential share price downside should industry sales continue to disappoint going forward."