Cracks appear in Cracker Barrel's bull thesis, Argus says in downgrade

• Cracker Barrel (CBRL -1.7%) is downgraded to Hold from Buy at Argus, which expects customer traffic to remain weak and same-store sales growth to decelerate over the next several quarters.
• Although CBRL reported better than expected Q2 earnings, it maintained its full-year EPS estimate, “implying slower growth in the second half of the year,” Argus says in reducing its EPS estimates for FY 2017 and 2018 to $8.20 from $8.30 and to $8.84 from $8.88, respectively.
• Cracker Barrel’s stock is trading slightly above the multiples of Darden Restaurants (DRI -0.3%), which Argus believes has stronger near-term growth prospects.