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Category: Stock Market and Cracker Barrel Old Country Store
Date: 26 February 2020 Stock Price: $159.35 We take a look at the 2nd quarter earnings release of their 2020 fiscal year of old style country stores and restaurants owner Cracker Barrel who owns and operates 664 stores across 45 states in the United States
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About Cracker Barrel Old Country Store
Cracker Barrel Old Country Store, Inc. (Nasdaq: CBRL), established in 1969 in Lebanon, Tenn., provides a friendly home-away-from-home in its old country stores and restaurants. Guests are cared for like family while relaxing and enjoying real home-style food and shopping that’s surprisingly unique, genuinely fun and reminiscent of America’s country heritage…all at a fair price. The restaurants serve up delicious, home-style country food such as meatloaf and homemade chicken n’ dumplins as well as our signature biscuits using an old family recipe. The authentic old country retail store is fun to shop and offers unique gifts and self-indulgences
Overview of Cracker Barrel's 2nd quarter 2020 earnings report
The data below refers to the latest quarterly data unless specified otherwise:
- Total revenue: $846.143 million (up from $811.707 million from the same quarter of the previous year)
- Revenues increased by 4% over the last 12 months
- Cost of Goods sold: $270.207 million (up from $265.179 million for the same quarter of the previous year)
- Cost of goods sold increased by 3% over the last 12 months
- Net income: $61.168 million (down from $60.755 million for the same quarter of the previous year)
- Diluted earnings per share: $2.55 (up 1% from $2.52 for the same quarter of the previous year)
- Dividend for the quarter: $1.30
- Dividend yield of Cracker Barrel: 3.3%
- Diluted weighted-average shares outstanding: 24.055 million (up from 24.093 million for the same quarter of the previous year)
- Cash and cash equivalents: $72.840 million
- Cash and cash equivalents per share: $3.02
- Cash and cash equivalents makes up 1.9% of Cracker Barrel's market capital
- Cash and cash equivalents makes up 3.4% of Cracker Barrel's total assets
- Receivables: $20.778 million
- Receivables makes up 0.97% of Cracker Barrel's total assets
- Inventories: $157.352 million
- Inventories makes up 7.36% of Cracker Barrel's total assets
- Stockholders equity in Cracker Barrel Old Country Store: $629.930 million
- Stockholders equity per share: $26.18
- Cracker Barrel's is trading at 6.1 times its stockholders equity per share which is well above the expected 2 to 4 times that most firms tend to trade at
- Cash generated from operations for six months of fiscal 2020: $184.004 million
- Cash generated from operations per share for six months of fiscal 2020: $7.64
Cracker Barrel's management commentary on their 2nd quarter 2020 earnings and guidance
LEBANON, Tenn., Feb. 25, 2020 /PRNewswire/ -- Cracker Barrel Old Country Store, Inc. ("Cracker Barrel" or the "Company") (Nasdaq: CBRL) today reported its financial results for the second quarter ended January 31, 2020.
Commenting on the second quarter results, Cracker Barrel President and Chief Executive Officer Sandra B. Cochran said, "I am pleased that we continued to outperform the casual dining industry and that we delivered solid operating income growth. The holidays are an important time for Cracker Barrel, and I believe this quarter we further strengthened our reputation as a destination for both in-store and off-premise holiday dining occasions, as demonstrated by the success of our Country Fried Turkey menu promotion and the continued growth of our off-premise business. Our teams continued to make progress on key initiatives, and I believe we are well-positioned to build on our momentum in the back half of our fiscal year."
Commenting on the second quarter results, Cracker Barrel President and Chief Executive Officer Sandra B. Cochran said, "I am pleased that we continued to outperform the casual dining industry and that we delivered solid operating income growth. The holidays are an important time for Cracker Barrel, and I believe this quarter we further strengthened our reputation as a destination for both in-store and off-premise holiday dining occasions, as demonstrated by the success of our Country Fried Turkey menu promotion and the continued growth of our off-premise business. Our teams continued to make progress on key initiatives, and I believe we are well-positioned to build on our momentum in the back half of our fiscal year."
Fiscal 2020 Outlook
The Company updated the following components of its fiscal 2020 outlook:
The Company updated the following components of its fiscal 2020 outlook:
- GAAP earnings per diluted share between $8.55 and $8.65
- This includes an expected loss from the Company's equity method investment in its unconsolidated subsidiary, Punch Bowl Social, resulting in an unfavorable GAAP earnings per diluted share impact of approximately ($0.80)
- This also includes transactional and integration expenses related to the Company's acquisition of Maple Street Biscuit Company, which are expected to result in an unfavorable impact to GAAP earnings per diluted share of approximately ($0.15)
- Cracker Barrel comparable store restaurant sales growth of 2.0% to 2.5%
- Approximately flat comparable store retail sales growth
- Commodity inflation, on a constant mix basis, of 1.5% to 2.0%
- Depreciation expense of approximately $115 million
- Sustainable cost savings of approximately $11 million
- Capital expenditures of approximately $125 million
- An effective tax rate of approximately 16.0%, which includes an expected tax benefit from the projected loss from the Company's equity method investment in Punch Bowl Social
Cracker Barrel Old Country Store (NASDAQ:CBRL) stock price history
The image below, obtained from Google, shows the stock price history of Cracker Barrel (NASDAQ: CBRL) for the last 5 years. And its been a very volatile and slightly positive time for Cracker Barrel stockholders. 5 years ago the stock was trading at around $151 and its currently trading at $159.35 That's a very average return of 5.52% provided to Cracker Barrel investors over the last 5 years. The stock of Cracker Barrel Old Country Store is trading at a lot closer to its 52 week low of $149.50 than it is to its 52 week high of $180.9 which to us is a clear indication that the short term sentiment and momentum of Cracker Barrel Old Country store stock is negative at this point in time.
Recent coverage of Cracker Barrel
The extract below covers the latest regarding Cracker Barrel as obtained from Nasdaq.com
(RTTNews) - Cracker Barrel Old Country Store, Inc. (CBRL) released earnings for its second quarter that climbed from last year. The company's profit came in at $61.17 million, or $2.55 per share. This compares with $60.76 million, or $2.52 per share, in last year's second quarter. Analysts had expected the company to earn $2.58 per share, according to figures compiled by Thomson Reuters. Analysts' estimates typically exclude special items. The company's revenue for the quarter rose 4.2% to $846.14 million from $811.71 million last year.
Read the article here
(RTTNews) - Cracker Barrel Old Country Store, Inc. (CBRL) released earnings for its second quarter that climbed from last year. The company's profit came in at $61.17 million, or $2.55 per share. This compares with $60.76 million, or $2.52 per share, in last year's second quarter. Analysts had expected the company to earn $2.58 per share, according to figures compiled by Thomson Reuters. Analysts' estimates typically exclude special items. The company's revenue for the quarter rose 4.2% to $846.14 million from $811.71 million last year.
Read the article here
Cracker Barrel (NASDAQ: CBRL) latest stock valuation
So based on the 1st quarter 2020 earnings report of Cracker Barrel (NASDAQ: CBRL) and what do we value Cracker Barrel (CBRL) stock at? Based on the earnings reported and the fiscal guidance provided our valuation model provides a target (full value) price for Cracker Barrel at $161.20 a stock (up slightly from our 1st quarter 2020 earnings report valuation of Cracker Barrel).
We therefore believe that Cracker Barrel is close to being fully valued.
We usually recommend long term fundamental or value investors look to enter a stock at least 10% below our target price (full value price) which in this case is $161.20. So a good entry point into Cracker Barrel would be around $145. We expect the stock of Cracker Barrel to trade in a narrow range around our target price (full value price) in coming weeks and months as it is close to being fully valued with limited upside scope at this point in time.
We therefore believe that Cracker Barrel is close to being fully valued.
We usually recommend long term fundamental or value investors look to enter a stock at least 10% below our target price (full value price) which in this case is $161.20. So a good entry point into Cracker Barrel would be around $145. We expect the stock of Cracker Barrel to trade in a narrow range around our target price (full value price) in coming weeks and months as it is close to being fully valued with limited upside scope at this point in time.
Next earnings release of Cracker Barrel Old Country Store
It is expected that Cracker Barrel Old Country Store will release their 3rd quarter 2020 earnings report towards the end of May 2020