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Customers Flock To Cracker Barrel Old Country Store

William Bias profile picture
William Bias


  • Good execution and lower gasoline prices contributed to the expansion of Cracker Barrel Old Country Store’s fundamentals.
  • The popularity of the store within a restaurant concept increased.
  • Cracker Barrel Old Country Store pays a decent dividend.

On Feb. 24, country store and restaurant chain Cracker Barrel Old Country Store (NASDAQ: NASDAQ:CBRL) came out with its Q2 FY 2015 earnings announcement and 10-q. The company has done well so far this year on the fundamental front and is beating the Wall Street expectations game. The stock was up roughly 9% on the day of the announcement. Let's take a look to see what's going on with the company.

The numbers

So far in its FY 2015, Cracker Barrel Old Country Store saw its year-to-date revenue, net income and free cash flow increase 7%, 26% and 354% respectively year-over-year. The company sits on an ok balance sheet. Its $183 million in cash and equivalents came to 33% of stockholder's equity last quarter. I like to see companies harbor cash amounting to 20% or more of stockholder's equity. However, its long-term debt to equity came in at 71% of stockholder's equity which is above my personal threshold of 50%. So far this year, Cracker Barrel Old Country Store's operating income exceeds interest expense by 14 times. The rule of thumb for safety lies at five times or more.

More popular than ever

Cracker Barrel Old Country Store's year-to-date same store sales increased 5.6% at its restaurants and 4.4% at its stores. This was driven, at least in part, by a 3% increase in restaurant traffic so far this year giving indication that customers like their experiences at Cracker Barrel Old Country Store's location. I always like to see companies expand their fundamentals due to increased popularity of products and services.

The customer experience stands out at the company. While people wait for a table they can shop at the country store while friendly employees stand ready to assist and greet. Lower gas prices also enhance the customer experience. Moreover, the company expanded its

This article was written by

William Bias profile picture
I have been analyzing stocks since 1992 and a freelance writer since 2012.

Analyst’s Disclosure: The author has no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. The author wrote this article themselves, and it expresses their own opinions. The author is not receiving compensation for it (other than from Seeking Alpha). The author has no business relationship with any company whose stock is mentioned in this article.

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Comments (2)

The one negative I see is that the quarter's results were boosted by January comparisons to last year when weather was even worse I think (see monthly same store numbers).
William Bias profile picture
That's a good point weather did have an impact. The CEO commented on a milder winter as having an affect as well. Sorry I didn't point that out.

Thanks for reading.

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