A sign of the times

This morning the parent of Applebee’s and IHOP posted a net loss of $137 million for the last three months of 2008, the result of having to reset the value of Applebee’s “goodwill,” or the worth of its name and other intangible assets. In other words, DineEquity Inc. determined the brand equity of the company it bought in 2007 for $2.3 billion is worth about $148 million less today. That left shareholders with a loss of $8.15 for every share they hold.

Yet DineEquity’s stock price has climbed about 20% so far today because the company would’ve posted a profit without the write-down—of roughly $5.7 million. That’s for a company that franchises nearly 1,400 full-service restaurants.