Today, DFRG announced the resignation of Jeff Carcara, Chief Operating Officer, effective immediately. According to the press release Mr. Carcara chose to leave the Company to pursue an executive leadership opportunity at a private restaurant company.
We view this change in the management team as good news for DFRG. The change in senior management team clears the path for the company to close underperforming Del Frisco Grille stores and halt new unit expansion plans too. For the better part of two years, the construction of new Del Frisco Grille stores has been destroying shareholder value of DFRG.
In addition, our sum of the parts valuation suggests only 10% downside from these levels.
Depending on how the stock behaves with the current news flow and what the future plans look like we are going to add it to the Hedgeye Restaurants LONG bench.
More to come when we get more details on what the future looks like for DFRG.