Core Viewpoint - Cheesecake Factory (CAKE) has received a Zacks Rank 2 (Buy) upgrade, indicating a positive outlook on its earnings estimates, which is a significant factor influencing stock prices [1][2]. Earnings Outlook - The Zacks Consensus Estimate for Cheesecake Factory for the fiscal year ending December 2024 is projected at $3.21 per share, reflecting a 19.3% increase from the previous year's reported figure [5]. - Over the past three months, the Zacks Consensus Estimate for the company has risen by 1.5%, indicating a trend of increasing earnings estimates [5]. Impact of Earnings Estimate Revisions - Changes in earnings estimates are strongly correlated with near-term stock price movements, with institutional investors using these estimates to assess the fair value of stocks [3][4]. - The Zacks rating system effectively utilizes earnings estimate revisions to classify stocks, with a historical average annual return of +25% for Zacks Rank 1 stocks since 1988 [4]. Zacks Rating System - The Zacks rating system maintains a balanced distribution of 'buy' and 'sell' ratings across over 4000 stocks, with only the top 20% receiving favorable ratings [6]. - The upgrade of Cheesecake Factory to a Zacks Rank 2 places it in the top 20% of Zacks-covered stocks, suggesting potential for market-beating returns in the near term [6].

Core Insights - Investors in the Retail - Restaurants sector should consider Cheesecake Factory (CAKE) and Compass Group PLC (CMPGY) for potential value opportunities [1] - CAKE has a stronger Zacks Rank of 2 (Buy) compared to CMPGY's Zacks Rank of 3 (Hold), indicating a better earnings outlook for CAKE [1] Valuation Metrics - CAKE has a forward P/E ratio of 13.08, significantly lower than CMPGY's forward P/E of 24.39, suggesting CAKE is undervalued [2] - The PEG ratio for CAKE is 1.21, while CMPGY's PEG ratio is 1.97, indicating CAKE's expected earnings growth is more favorable [2] - CAKE's P/B ratio stands at 5.73, compared to CMPGY's P/B of 8.60, further supporting CAKE's valuation advantage [3] Value Grades - Based on the analysis of various valuation metrics, CAKE receives a Value grade of A, while CMPGY is rated C, highlighting CAKE as the superior value option [3]

Core Viewpoint - The Cheesecake Factory (CAKE) is currently considered a strong value stock, with favorable valuation metrics indicating it may be undervalued compared to its industry peers [2][4]. Valuation Metrics - CAKE holds a Zacks Rank of 2 (Buy) and a Value grade of A, with a P/E ratio of 12.16, significantly lower than the industry average of 25.67 [2]. - The stock's Forward P/E has fluctuated between 9.89 and 13.36 over the past 12 months, with a median of 11.28 [2]. - CAKE has a PEG ratio of 1.12, compared to the industry average of 1.77, with its PEG ratio ranging from 0.46 to 1.23 in the past year [2]. - The P/S ratio for CAKE is 0.61, lower than the industry average of 0.88, indicating better performance relative to sales [3]. - CAKE's P/CF ratio stands at 9.73, which is attractive compared to the industry's average of 22.57, with a range of 7.85 to 9.91 over the past 52 weeks [3]. Investment Outlook - The combination of these metrics suggests that The Cheesecake Factory is likely undervalued, making it one of the strongest value stocks in the market based on its earnings outlook [4].

KEY TAKEAWAYSJCP Investment Management, an activist investor, reportedly has built a stake in The Cheesecake Factory and is pushing for the restaurant chain to break up.The Cheesecake Factory shares are up 3% in premarket trading.According to The Wall Street Journal, Houston-based JCP has a roughly 2% stake in The Cheesecake Factory and is asking the restaurant operator to spin off three of its smaller brands into a separate public company focused on faster growth. JCP Investment Management, an activist inv ...

Vancouver, British Columbia--(Newsfile Corp. - October 16, 2024) - Radio Fuels Energy Corp. (CSE: CAKE) (the "Company" or "Radio Fuels") announces that it has acquired ownership and control of 14,166,667 units (the "Subject Units") of Freeman Gold Corp. ("Freeman"), effective October 16, 2024 (the "Acquisition"). Each Subject Unit consists of one common share of Freeman ("Share") and one common share purchase warrant ("Warrant") exercisable at $0.08 for a period of nine months from the date of issuance. Th ...

With consumers tightening their spending habits, one would assume the consumer discretionary sector and, specifically, the restaurant industry would be feeling the sting. However, this isn't the case for some restaurants as they continue to navigate the macroeconomic climate masterfully, still collecting tight-fisted consumer dollars while maintaining strong margins. Some restaurants' stocks are cut above the rest. In this case, you can still have your CAKE and EAT it, too, with these two restaurant stocks ...

Cheesecake Factory (CAKE, Financial) has recently surpassed its $34-41 trading range, reaching a new 52-week high. This movement comes ahead of its Q3 earnings report on October 29. The recent performance of Brinker (EAT, Financial), which operates Chili's, has also drawn attention to CAKE.In late July, CAKE reported its third consecutive quarter of EPS growth. Revenue increased by 4.4% year-over-year to $904 million, slightly below analyst expectations but at the high end of prior guidance. Notably, CAKE's ...

There are different ways to create value. This is a fact. Since value is a subjective and personal characteristic, we can infer that perceptions of value are not limited to aI'm an equity analyst specializing in restaurant stocks, with a solid background in Business Administration and Accounting. I also have an MBA in Forensic Accounting and Controllership.As the founder of Goulart's Restaurant Stocks, I lead a company that excels at analyzing restaurant stocks in the US market. Our approach covers a wide r ...

A month has gone by since the last earnings report for Cheesecake Factory (CAKE) . Shares have added about 6.6% in that time frame, outperforming the S&P 500.Will the recent positive trend continue leading up to its next earnings release, or is Cheesecake Factory due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts. Cheesecake Factory Q2 Earnings Beat E ...

Revenue Growth and Financial Performance - Revenues increased by 4.4% to $904.0 million for the fiscal quarter ended July 2, 2024 compared to $866.2 million for the comparable prior year period, driven by new restaurant openings and an increase in comparable restaurant sales[96] - Net income increased to 5.8% of revenues in Q2 2024, up from 4.9% in Q2 2023[95] - The Cheesecake Factory sales increased 3.7% to $676.7 million in Q2 fiscal 2024, with comparable sales up 1.4% driven by a 1.6% increase in average check[97] - North Italia sales increased 14.6% to $75.5 million in Q2 fiscal 2024, with comparable sales up 2% driven by a 3% increase in average check[98] - Flower Child sales increased 6.6% to $35.7 million in Q2 fiscal 2024, with total operating weeks up 6.7% to 416[100] - Other FRC sales increased 12.0% to $73.6 million in Q2 fiscal 2024, despite a 5.7% decrease in average sales per restaurant operating week[101] - Adjusted net income for the twenty-six weeks ended July 2, 2024, was $88.7 million, compared to $73.7 million for the same period in 2023[125] - Total revenue for fiscal 2024 is anticipated to be approximately $3.56 billion to $3.60 billion[123] - Third quarter fiscal 2024 revenues are expected to be between $855 million and $870 million, with a net income margin of 2.6% to 3.0%[124] Restaurant Operations and Expansion - The company operates 340 restaurants in the U.S. and Canada, including 216 The Cheesecake Factory locations, 39 North Italia locations, 33 Flower Child locations, and 44 other FRC portfolio locations[85] - Internationally, 34 The Cheesecake Factory restaurants operate under licensing agreements[85] - The company plans to continue expanding The Cheesecake Factory and North Italia concepts, with a focus on opening new restaurants in premier locations[86] - The company plans to open as many as 22 new restaurants in fiscal 2024, including 3 The Cheesecake Factory, 6-7 North Italia, 6-7 Flower Child, and 7-8 Other FRC locations[124] - North Italia's total operating weeks increased 16.3% to 499 in Q2 fiscal 2024, compared to 429 in the prior year[98] - Flower Child's total operating weeks increased 6.7% to 416 in Q2 fiscal 2024, compared to 390 in the prior year[100] - Preopening costs increased to $7.0 million in Q2 fiscal 2024, up from $6.0 million in Q2 fiscal 2023, due to new restaurant openings[107] - Supply chain challenges and delays in new restaurant openings due to permitting and landlord readiness issues have impacted operations in fiscal 2024[83] Cost Management and Margins - Food and beverage costs decreased to 22.3% of revenues in Q2 2024 from 23.2% in Q2 2023, while labor expenses remained stable at 35.1% compared to 35.3% in the prior year[95] - Food and beverage costs decreased to 22.3% of revenues in Q2 fiscal 2024, down from 23.2% in Q2 fiscal 2023, due to menu price increases and sales mix shifts[103] - Labor expenses decreased to 35.1% of revenues in Q2 fiscal 2024, down from 35.3% in Q2 fiscal 2023, driven by menu price increases and improved productivity[104] - The company aims to recapture pre-COVID-19 pandemic margins and drive long-term margin expansion through sales leverage, bakery operations, and optimizing the restaurant portfolio[90] - Menu price increases have been implemented above historical levels (2%-3%) since 2022 to offset inflationary cost pressures, with potential future increases to manage significant cost rises[89] - A hypothetical 1% increase in food costs would negatively impact cost of sales by $2.0 million for both Q2 fiscal 2024 and 2023[145] - Commodities not under contract are subject to significant supply and cost fluctuations, especially for government-regulated items like dairy and corn[145] - International market purchases face greater cost and availability fluctuations due to currency values, trade disputes, tariffs, and geopolitical unrest[145] - The company attempts to negotiate short-term and long-term agreements for principal commodities like dairy and poultry, depending on market conditions[144] - The company evaluates hedging vehicles like direct financial instruments to manage commodity risk and variability[144] - The company had no hedging contracts in place as of July 2, 2024[144] Capital Expenditures and Financial Position - Estimated cash capital expenditures for fiscal 2024 are between $180 million and $200 million to support new unit development and restaurant maintenance[124] - Capital expenditures for new restaurants in the first six months of fiscal 2024 were $38.9 million, with $24.8 million allocated to existing restaurants and $2.6 million for bakery and corporate infrastructure[129] - Cash and cash equivalents decreased by $15.6 million to $40.7 million in the first six months of fiscal 2024[127] - The company repurchased 0.5 million shares at a cost of $16.4 million (excluding excise tax) during the first six months of fiscal 2024[135] - The company has a revolving credit facility with a total commitment of $400 million, of which $236.5 million was available as of July 2, 2024[132] - The company paid $26.7 million in common stock dividends during the first six months of fiscal 2024[134] - A hypothetical 1% rise in interest rates would increase annual interest expense by $1.3 million based on outstanding borrowings at July 2, 2024 and January 2, 2024[146] - A hypothetical 10% decline in market value of deferred compensation assets would reduce net income by $2.5 million at July 2, 2024 and $2.4 million at January 2, 2024[146] External Factors and Risks - Operating results in fiscal 2024 continue to be impacted by increased commodity and wage inflation from geopolitical and macroeconomic events[143] - Climate change may exacerbate factors affecting product and service costs, including labor availability, weather, and natural disasters[143] - The company targets a long-term financial objective of 13% to 14% total return to shareholders, driven by domestic revenue growth, margin expansion, and planned debt repayments[92] - The Cheesecake Factory's off-premise channel sales accounted for 21% of total restaurant sales in Q2 fiscal 2024, down from 22% in Q2 fiscal 2023[97]