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Investing.com -- Shares of One Group Hospitality Inc (NASDAQ:STKS) the operator behind Benihana and STK Steakhouse, rose 4.2% Friday amid a sweeping turnaround plan unveiled by activist investor Randian Capital. The proposal calls for refocusing entirely on the Benihana brand, divesting non-core assets, and instituting operational and financial discipline in a bid to reverse the company’s sliding fortunes.
Randian, a player in the “retail activist” army behind the meteoric rise of Opendoor Technologies Inc (NASDAQ:OPEN) over the past months, looks to apply a similar formula to One Group, an embattled company holding an iconic brand and heaps of potential.
The announcement arrives as STKS trades near 52-week lows, closing Friday at $2.46, down 34.4% over the past year. Despite a projected 24.4% increase in 2025 revenue, the stock has been battered by high leverage, thin margins, and a series of leadership changes tied to the evolving Benihana integration.
Randian argues STK Steakhouse alone could be sold for $200–$300 million, enabling debt reduction and financial flexibility. “We see a path to a $10+ stock over 12–18 months,” the firm said, adding the plan contains four pillars: “Refocus the Portfolio, Revitalize the Brand, Strengthen Operations, and Capital Discipline & Growth.”
The firm proposes renaming the company “Benihana Group” and adopting the ticker “HANA” to signal brand clarity. It also encourages revitalizing the chain’s cultural relevance by partnering with a major public figure, referencing the boost American Eagle saw from celebrity affiliations with actress Sydney Sweeney and NFL star Travis Kelce.
Operational concerns remain acute. The company’s EBITDA margin sits at 10.3%, while its free cash flow yield is deeply negative at -30.9%, and its debt-to-equity ratio has soared to 1,361.1%, a level that raises red flags around liquidity, especially with a current ratio of just 0.5x.
Randian’s plan includes AI-based optimization tools, comprehensive staff retraining, and slowing new restaurant openings until same-store sales stabilize. “We recommend slowing this pace until SSS is back on track,” the firm emphasized when addressing capital allocation priorities.
Benihana now comprises over 55% of group revenue, with $20 million in projected synergies by 2026. Newly appointed CFO Nicole Thaung, a Benihana alum, is tasked with navigating the consolidation and driving margin improvement, critical amid projected FY25 EPS of $0.34 after a crushing fall in FY24.
Analysts remain split: while price targets suggest an 89.7% upside, concerns linger. Technicals flash long-term sell signals, and Investing.com’s WarrenAI flags the stock as high risk/high reward, noting that “the turnaround hinges on execution” as The One Group walks a fine line between reinvention and distress.