Cracker Barrel Falls After Reporting Quarterly Results, Guidance
Shares of restaurant operator Cracker Barrel (CBRL) are falling after reporting fourth quarter financial results and providing an outlook for the fiscal year 2017.
WHAT'S NEW: Before the market open, Cracker Barrel reported Q4 earnings per share of $2.12 on revenue of $745.6M. EPS expectations for the quarter were for $2.13 on revenue of $742.34M. Comparable store restaurant sales increased 3.2%, including a 4.4% increase in average check partially offset by a 1.2% decrease in store traffic. The average menu price increase for the quarter was approximately 2.4%. Comparable store retail sales were up 3.5% for the quarter.
The company opened four new Cracker Barrel stores during the quarter, and one new Holler & Dash Biscuit House, bringing the combined store count to 641 locations at fiscal year-end. Looking ahead, the company guided to first quarter EPS of $1.75-$1.85, below the $1.93 that analysts were expecting. For the upcoming fiscal year, Cracker Barrel is forecasting EPS of $7.95-$8.10 on revenue of $2.95B-$3.0B. Analysts were looking for FY17 EPS of $8.32 on revenue of $3.01B. The company is expecting open seven or eight new Cracker Barrel stores and projected increases in comparable store restaurant sales and retail sales in a range of 1% to 2%. "We believe the strategic programs we implemented during the fiscal year successfully drove our continued positive results. While we anticipate ongoing challenges in the industry during fiscal 2017, our management team and employees remain focused on delivering continued growth in our business and driving long-term shareholder value," said Cracker Barrel President and CEO Sandra B. Cochran.
ANALYST VIEW: On July 11, BofA/Merrill analyst Joseph Buckley downgraded Cracker Barrel to Underperform from Neutral and lowered its price target to $140 from $167. At the time, the analyst said shares are trading at an all-time high and believes strong growth will slow given slow overall industry sales and the competitive environment.
PRICE ACTION: Shares of Cracker Barrel were up approximately 19% this year before this decline, but are now falling in afternoon trading by $9.42, or 6.26%, to $141.11 per share.
OTHERS TO WATCH: Other companies in the fast-casual restaurant space include Restaurant Brands International (QSR), McDonald's (MCD), Darden Restaurants (DRI), Chipotle Mexican Grill (CMG), Panera Bread (PNRA) and Shake Shack (SHAK ).
Disclosure: None.