Cheesecake Factory (NASDAQ:CAKE) Hits New 1-Year High - Should You Buy?

Key Points

• Cheesecake Factory shares reached a new 52-week high, trading around $104, well above their 50-day and 200-day moving averages. Despite the rally, analysts’ consensus rating remains “Hold,” with an average price target of $79.81.
• The company delivered a strong quarterly performance, reporting $1.44 in EPS versus the $1.18 consensus and $1.03 billion in revenue, up 7.7% year over year.
• Cheesecake Factory declared a quarterly dividend of $0.30, equivalent to a 1.2% annual yield, while insiders sold approximately $7.35 million of stock over the past 90 days—potential cautionary signals for prospective buyers.

The Cheesecake Factory Incorporated (NASDAQ:CAKE - Get Free Report)'s share price reached a new 52-week high during trading on Monday . The stock traded as high as $103.36 and last traded at $104.32, with a volume of 116942 shares traded. The stock had previously closed at $101.42.

Wall Street Analysts Forecast Growth

A number of brokerages have weighed in on CAKE. Barclays upped their price target on Cheesecake Factory from $58.00 to $60.00 and gave the company an "underweight" rating in a research report on Thursday, April 30th. Deutsche Bank Aktiengesellschaft restated a "hold" rating and issued a $68.00 target price on shares of Cheesecake Factory in a research note on Thursday, April 30th. Citigroup upped their target price on shares of Cheesecake Factory from $76.00 to $90.00 and gave the stock a "buy" rating in a report on Friday, July 10th. Oppenheimer increased their target price on shares of Cheesecake Factory from $91.00 to $101.00 and gave the stock an "outperform" rating in a research report on Wednesday. Finally, Wells Fargo & Company lifted their price target on shares of Cheesecake Factory from $65.00 to $75.00 and gave the company an "equal weight" rating in a report on Thursday, July 16th. One investment analyst has rated the stock with a Strong Buy rating, five have given a Buy rating, eleven have given a Hold rating and two have given a Sell rating to the company. According to MarketBeat, the company has an average rating of "Hold" and an average price target of $79.81.

Cheesecake Factory Stock Performance

The stock has a 50-day moving average of $77.60 and a 200 day moving average of $66.20. The firm has a market capitalization of $5.17 billion, a P/E ratio of 28.26, a price-to-earnings-growth ratio of 1.83 and a beta of 1.01. The company has a debt-to-equity ratio of 1.22, a quick ratio of 0.53 and a current ratio of 0.59.

Cheesecake Factory (NASDAQ:CAKE - Get Free Report) last issued its quarterly earnings data on Tuesday, July 28th. The restaurant operator reported $1.44 earnings per share (EPS) for the quarter, beating the consensus estimate of $1.18 by $0.26. The firm had revenue of $1.03 billion during the quarter, compared to the consensus estimate of $999.54 million. Cheesecake Factory had a return on equity of 45.94% and a net margin of 4.61%.The business's revenue for the quarter was up 7.7% compared to the same quarter last year. During the same quarter in the previous year, the company posted $1.16 EPS. On average, research analysts anticipate that The Cheesecake Factory Incorporated will post 4.43 earnings per share for the current year.

Cheesecake Factory Dividend Announcement

The firm also recently announced a quarterly dividend, which will be paid on Tuesday, August 25th. Stockholders of record on Tuesday, August 11th will be paid a $0.30 dividend. The ex-dividend date is Tuesday, August 11th. This represents a $1.20 dividend on an annualized basis and a dividend yield of 1.2%. Cheesecake Factory's dividend payout ratio (DPR) is 32.52%.

Insider Activity at Cheesecake Factory

In other Cheesecake Factory news, insider Ashley W. Hanscom sold 3,500 shares of the stock in a transaction dated Thursday, July 30th. The shares were sold at an average price of $100.00, for a total transaction of $350,000.00. Following the sale, the insider owned 7,541 shares of the company's stock, valued at $754,100. This represents a 31.70% decrease in their position. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which can be accessed through this hyperlink. Also, Director Alexander L. Cappello sold 2,490 shares of the firm's stock in a transaction dated Tuesday, June 2nd. The shares were sold at an average price of $64.90, for a total transaction of $161,601.00. Following the completion of the sale, the director owned 6,171 shares of the company's stock, valued at $400,497.90. The trade was a 28.75% decrease in their position. The SEC filing for this sale provides additional information. Insiders sold 74,890 shares of company stock valued at $7,353,371 over the last ninety days. 8.00% of the stock is owned by insiders.

Institutional Trading of Cheesecake Factory

Hedge funds have recently modified their holdings of the stock. Salomon & Ludwin LLC increased its holdings in shares of Cheesecake Factory by 226.5% in the fourth quarter. Salomon & Ludwin LLC now owns 604 shares of the restaurant operator's stock valued at $33,000 after purchasing an additional 419 shares in the last quarter. NFSG Corp boosted its position in Cheesecake Factory by 115.8% in the 1st quarter. NFSG Corp now owns 682 shares of the restaurant operator's stock valued at $37,000 after buying an additional 366 shares during the last quarter. Global Retirement Partners LLC boosted its position in Cheesecake Factory by 661.7% in the 4th quarter. Global Retirement Partners LLC now owns 716 shares of the restaurant operator's stock valued at $36,000 after buying an additional 622 shares during the last quarter. Root Financial Partners LLC boosted its position in Cheesecake Factory by 973.2% in the 4th quarter. Root Financial Partners LLC now owns 880 shares of the restaurant operator's stock valued at $44,000 after buying an additional 798 shares during the last quarter. Finally, Arax Advisory Partners acquired a new stake in shares of Cheesecake Factory in the 4th quarter valued at $50,000. 94.48% of the stock is owned by institutional investors.

Cheesecake Factory Company Profile

The Cheesecake Factory Incorporated NASDAQ: CAKE is an American restaurant company and distributor renowned for its full-service casual-dining concept and specialty cheesecakes. Headquartered in Calabasas Hills, California, the company operates more than 200 restaurants under The Cheesecake Factory® brand across the United States, Puerto Rico and select international markets. In addition to sit-down dining, Cheesecake Factory franchised locations offer catering and take-out services, while a separate manufacturing arm supplies branded cheesecakes and desserts to supermarkets, hotels and other foodservice operators.

The origins of the brand trace back to a small cheesecake bakery founded in Detroit in the 1940s.

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