Rob Black's Retail Market Roundup For April 26 (CAKE, MIDD, PZZA, SKX)

The Cheesecake Factory's (CAKE) 1st quarter EPS was $0.24 the consensus of $0.25. However, the $0.24 also included a gain of approximately $0.02, so on an adjusted basis EPS was about $0.22, or $0.03 below our estimate. The Cheesecake Factory reported only its 2nd negative quarterly comp in its history in the 1st quarter, with same-store sales declining 1.6% at the core Cheesecake Factory brand.

Excluding two calendar shifts, same-store sales rose 0.6%, but were still below the company's 2% price factor, implying negative traffic of at least 1.4%. The company attributed the weakness to general weakness in the consumer, with the weakest markets being the Midwest and California. Same-store sales in the first 3 weeks of April are positive, but still running slightly below the 2% price increase, despite that they are benefiting from one of the calendar shifts that hurt the 1st quarter. Analysts have lowered our comp estimate to 1% from 3% for the 2nd quarter, and to 1% from 2% for the remainder of the year.

To offset rising energy costs, pizza chain Papa John's (PZZA) will replace all current ovens in its restaurants with a new energy-efficient model made by publicly traded Middleby Marshall (MIDD) that promises to cut energy consumption 25 percent and bake pies 30 percent faster. You can now get a pizza in 10 minutes.

Skechers USA Inc. (SKX) reported earnings of $16.6 million up 62% from $10.3 million in the year-ago period. Revenue at the footwear retailer rose 12.7% to $277.6 million from $246.2 million.