The stock traded as high as $11.56 in December 1998, and then was shaved to as low as 30 cents a share in October 2000. The high until February 2004 was $1.30, when the stock's long-term turnaround story began.
After a high of $6.20 in July 2005, the shares crashed with the stock market to a low of $1.15 in March 2009, returning to the status of being an "option on survival." Investors who believed in a recovery of this eatery reaped huge returns, but daily and weekly charts show that the turnaround story is coming to an end. Investors should thus shift to a new menu.
Denny's is scheduled to report its quarterly results after the closing bell on Monday. Analysts expect the company to post earnings of 9 cents a share. The daily and weekly charts show significant downside risk, particularly if the stock loses its investment-grade $10 share price.
A stock trading under $5 a share cannot be bought on margin at many brokerage firms. Stocks trading for less than $3 a share should be considered an option on survival where you invest money you can afford to lose.
The key threshold today is $10 a share as many institutional equity money managers cannot own a stock trading below $10. Denny's has been above $10 only since Jan. 8, and may not yet be on equity funds watch list.