| I don't get to Cracker Barrel as often as I'd like and when I do I wonder why. It's a great restaurant. They serve great food in a casual dining atmosphere and I always think I'll come back more often. If you like great country cooking in a relaxed setting, you'll love Cracker Barrel. A lot of people do. |  |
The Company
| Cracker Barrel Old Country Store, Inc. (CBRL) develops and operates the Cracker Barrel Old Country Store concept in the United States. It operates full-service restaurants, which provide breakfast, lunch, and dinner. The company also operates gift shops that offer various decorative and functional items, such as rocking chairs, holiday and seasonal gifts and toys, apparel, music CD’s, cookware, old-fashioned-looking ceramics, figurines, a book-on-audio sale-and-exchange program, and various other gift items, as well as candies, preserves, pies, cornbread mixes, coffee, syrups, pancake mixes, and other food items. As of May 28, 2014, the company operated 627 company-owned locations in 42 states. The company was founded in 1969 and is headquartered in Lebanon, Tennessee. (Daily Chart) (Weekly Chart)  The very first Cracker Barrel restaurant. | 11 August 2014 Price $98.61 1yr Target $108.33 Analysts 3 1yr Cap Gain 9.85% Dividend $4.00 Yield 4.05% 1yr Tot Return 13.90% Market Cap $2.34 Bil 3yr EarnGR 10.50% 5yr EarnGR 11.84% 3yr DivGR 40.66% 5yr DivGR 25.59% Payout Ratio 75.32% Beta 0.85 EPS (ttm) $5.31 EPS next yr $6.17 P/E 18.46 PEG 1.88 Debt/Equity 0.82 ROA 9.30% ROE 26.20% |
Cracker Barrel is a combination of Restaurant and Country Store. Most of the food offerings would be considered "down home cooking" and most of the items in the store would be considered things you would associate with a country life style. I rarely eat at a Cracker Barrel restaurant and leave without buying something in the store.
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The Fundamentals
| Year (Aug) 2015 Est 2014 Est 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 2003 | Revenues $2.79 Bil $2.69 Bil $2.64 Bil $2.58 Bil $2.43 Bil $2.40 Bil $2.36 Bil $2.38 Bil $2.35 Bil $2.64 Bil $2.56 Bil $2.38 Bil $2.19 Bil | Earnings $6.17 $5.58 $4.90 $4.40 $3.61 $3.62 $2.89 $2.80 $2.52 ($2.71*) $2.50 $2.45 $2.23 $2.09 | Dividends $4.00 $3.25 $2.25 $1.15 $0.88 $0.80 $0.80 $0.72 $0.56 $0.52 $0.48 $0.44 $0.02 | Payout Ratio 64.82% 58.24% 45.91% 26.13% 24.37% 22.09% 27.68% 25.71% 22.22% 20.80% 22.74% 19.73% 0.95% |
| *NOTE: The jump in EPS in 2007 was due to the divestiture of Logan’s Roadhouse Restaurants, and when this income is discounted eps returns to a more realistic $2.52. |
| Revenues Growth Rates 3yr = 3.19% 5yr = 2.09% 10yr = 1.88% Earnings Growth Rates 3yr = 10.50% 5yr = 11.84% 10yr = 8.89% Dividend Growth Rates 3yr = 40.66% 5yr = 25.59% 9yr = 19.66% 10yr = 60.36% |  |
The Technicals
There's not much to be learned from the technicals on this company's stock. The MACD has been sitting on the zero line for months, the RSI has been wavering around the mid mark for months, and the ADX shows little if any pressure either up or down. Any decision on whether to buy or sell this stock will have to come from the fundamentals.
 Daily Chart |  Weekly Chart |
The Competition
Cracker Barrel Country Store, Inc. is part of the Restaurants Industry which is part of the Services Sector of the economy. Below are a few of the major corporations included in this industry. They are listed in the order of their market capitalization.
Conclusion
The Restaurant Industry is flush with great restaurants and the majority of them fall into either the fast food category or the casual dining category. Lately the fast food category has been struggling while the casual dining sector been more successful. Luckily Cracker Barrel is in the casual dining sector.
At first blush the fundamentals look good but upon closer look there's one flaw that's hard to over look. Management has been expanding the dividend at a very fast rate and way in excess of the growth of their earnings. While the result has been to distribute a very nice 4.05% yield, it's also obvious that future dividend increases can not possibly increase at this rate. It's just too generous.
This in conjunction with the technicals tells me that this stock will probably continue to go sideways. Eventually the stock will become undervalued and start to move up once again, but the dividend growth rate may be stagnant for quite a bit longer.
I'll wait for a pullback in this stock to the low $90s before I start a position in the stock. It's a great company but there are a lot of great companies in the Restaurant Industry.
At first blush the fundamentals look good but upon closer look there's one flaw that's hard to over look. Management has been expanding the dividend at a very fast rate and way in excess of the growth of their earnings. While the result has been to distribute a very nice 4.05% yield, it's also obvious that future dividend increases can not possibly increase at this rate. It's just too generous.
This in conjunction with the technicals tells me that this stock will probably continue to go sideways. Eventually the stock will become undervalued and start to move up once again, but the dividend growth rate may be stagnant for quite a bit longer.
I'll wait for a pullback in this stock to the low $90s before I start a position in the stock. It's a great company but there are a lot of great companies in the Restaurant Industry.
The Live Interactive Chart
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