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IHOP parent ready to buy...but there's a problem

DineEquity is ready to pull the trigger on an acquisition, but there's a problem with the current crop of fast casual restaurants, its CEO said Tuesday.

"There is a lot of fast casual in America—a lot of sameness," Julia Stewart said in an interview. Low volume is another problem plaguing many small fast casuals, she said.

Julia Stewart, DineEquity CEO
Scott Mlyn | CNBC

"Maybe it's a needle in a haystack, I don't know, but we continue to look," Stewart said. "You really want to stand out with what you buy."

The ideal restaurant purchase would be small, unique, profitable and tested in multiple markets already. It would join DineEquity's two flagship brands: family dining chain IHOP and casual dining restaurant Applebee's.

"Most likely, it would be fast casual or fast food," she said. "We're not going to go anywhere near another concept in casual or family."

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Fast casual restaurants offer customers a faster experience than full-service dining along with more premium ingredients than fast food. The segment, which includes brands like Chipotle Mexican Grill and Panera Bread, has been a growth driver for the overall restaurant space.

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Restaurants giants, like DineEquity, frequently either buy or develop new concepts to develop additional growth pipelines or test out ideas for their larger chains.

"Oftentimes when you are looking at the industry and recognize you're in a more mature segment, the opportunity for growth isn't necessarily as strong there," said Darren Tristano, an executive vice president at Technomic, in a phone interview.

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Full service, which includes brands like IHOP and Applebee's, is one such example of a mature segment, he added.

Even as DineEquity continues to hunt for a small purchase, investors should not expect a deal anytime soon.

"There are a variety of things we're looking at—nothing that's imminent, nothing's that surfaced to the top," Stewart said.