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Cracker Barrel (CBRL) Beats on Q4 Earnings, Misses Revenues

Zacks

Cracker Barrel Old Country Store, Inc. CBRL posted mixed fourth-quarter fiscal 2017 results wherein the bottom line beat the Zacks Consensus Estimate while the top line lagged the same. Consequently, shares were up over 1% in yesterday’s trading session.

Earnings & Revenues

Cracker Barrel’s earnings of $2.23 per share for the fiscal fourth quarter surpassed the Zacks Consensus Estimate of $2.18 by 2.3%. The bottom line also increased 5.3% from the year-ago figure of $2.12 on somewhat lower expenses, given the company’s various cost cutting efforts.

The company reported revenues of $743.2 million in the quarter, missing the Zacks Consensus Estimate of $750 million by nearly 1%. Meanwhile, the top line witnessed a decline of 0.3% on a year-over-year basis.

Behind the Headline Numbers

Comparable store restaurant sales decreased 0.8% year over year compared with 0.4% decline recorded in the fiscal third quarter. A 0.9% increase in average check was more than offset by a 1.7% decrease in traffic, leading to the comps decline. Notably, the average menu price rise for the quarter was close to 1.4%.

Also, comparable store retail sales fell 4.4% in the fiscal fourth quarter, slightly better than the 4.7% decline recorded in the last quarter.

Operating Highlights

Operating margin in the reported quarter was 11.2%, up 80 basis points (bps), from 10.4% a year ago.

Cracker Barrel Old Country Store, Inc. Price, Consensus and EPS Surprise

Cracker Barrel Old Country Store, Inc. Price, Consensus and EPS Surprise | Cracker Barrel Old Country Store, Inc. Quote


Fiscal 2017 Results

Earnings per share (EPS) in fiscal 2017 were $8.37, ahead of the Zacks Consensus Estimate of $8.30. In addition, it increased 10.9% from the year-ago quarter figure of $7.55.

Total revenue of $2.93 billion was in line with the Zacks Consensus Estimate but increased 0.5% year over year.

Fiscal 2018 Outlook

In the first-quarter fiscal 2018, the company expects earnings in the range of $1.85 to $1.95 per share.

Meanwhile, for fiscal 2018, Cracker Barrel anticipates earnings in the band of $8.85 to $9.00 per share.

It is to be noted that the company's 2018 fiscal year is a 53-week year. Cracker Barrel estimates the impact of the 53rd week, which is included in its guidance, to contribute roughly 30 cents to earnings per share.

Notably, the company’s guidance for the first quarter and fiscal 2017 does not take into account the impact of hurricanes, Harvey and Irma. However, it is possible that these storms could affect EPS by roughly 15 cents, a major portion of which is expected to be in the fiscal first quarter.

Meanwhile, revenues are expected to be approximately $3.1 billion in fiscal 2018 based on the expected opening of eight or nine new Cracker Barrel stores and three or four new Holler & Dash Biscuit House restaurants. The outlook also takes into consideration projected increase in comparable store restaurant sales in the range of 2.5% to 3.5%, and comparable store retail sales of flat to up 1%.

Operating margin is expected to be relatively flat to the prior year as a percent of total revenue. Meanwhile, capital expenditures are anticipated to be roughly $150 million to $160 million.

Cracker Barrel carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Peer Releases

Darden Restaurants, Inc.’s DRI fourth-quarter fiscal 2017 adjusted earnings of $1.18 per share outpaced the Zacks Consensus Estimate of $1.15 by 2.6%. Further, the bottom line improved 7.3% year over year on the back of higher revenues and lower share count.

Buffalo Wild Wings, Inc.’s BWLD second-quarter adjusted earnings of 66 cents per share plunged 48% year over year and missed the Zacks Consensus Estimate of $1.01 by 34.7%.

In second-quarter fiscal 2017, DineEquity, Inc. DIN posted earnings of $1.30 per share that surpassed the Zacks Consensus Estimate of $1.20 by 8.3%. However, earnings declined 18.2% year over year mainly due to lower revenues and decline in gross profits.

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