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

Key Points

• Cheesecake Factory stock hit a new 52-week high, trading as high as $80.93 and extending a strong rally. The shares have also moved well above their 50-day and 200-day moving averages.
• Recent analyst activity was mixed, with Citigroup downgrading the stock to neutral while some firms raised price targets. Overall, the consensus rating remains Hold with a target price of $64.94.
• The company posted better-than-expected quarterly results, including EPS of $1.05 versus $1.03 expected and revenue of $978.83 million versus $964.57 million expected. It also pays a quarterly dividend of $0.30, or $1.20 annually, for a yield of about 1.5%.

Shares of The Cheesecake Factory Incorporated (NASDAQ:CAKE - Get Free Report) reached a new 52-week high during trading on Wednesday . The stock traded as high as $80.93 and last traded at $80.3260, with a volume of 258305 shares changing hands. The stock had previously closed at $79.54.

Analysts Set New Price Targets

Several research analysts recently weighed in on the company. Citigroup lowered Cheesecake Factory from a "buy" rating to a "neutral" rating in a research report on Monday, June 15th. Weiss Ratings lowered Cheesecake Factory from a "buy (b)" rating to a "buy (b-)" rating in a research note on Tuesday, June 23rd. Stephens increased their price target on Cheesecake Factory from $61.00 to $65.00 and gave the stock an "equal weight" rating in a report on Thursday, April 30th. Barclays raised their price objective on Cheesecake Factory from $58.00 to $60.00 and gave the stock an "underweight" rating in a research report on Thursday, April 30th. Finally, Wells Fargo & Company upped their target price on shares of Cheesecake Factory from $60.00 to $65.00 and gave the company an "equal weight" rating in a research report on Thursday, April 30th. Five analysts have rated the stock with a Buy rating, eleven have given a Hold rating and three have assigned a Sell rating to the company's stock. Based on data from MarketBeat, the company has a consensus rating of "Hold" and a consensus target price of $64.94.

Cheesecake Factory Price Performance

The company has a fifty day moving average of $66.64 and a 200-day moving average of $60.97. The company has a current ratio of 0.59, a quick ratio of 0.53 and a debt-to-equity ratio of 1.22. The stock has a market cap of $3.99 billion, a PE ratio of 23.47, a P/E/G ratio of 1.90 and a beta of 1.04.

Cheesecake Factory (NASDAQ:CAKE - Get Free Report) last announced its earnings results on Wednesday, April 29th. The restaurant operator reported $1.05 EPS for the quarter, beating analysts' consensus estimates of $1.03 by $0.02. The company had revenue of $978.83 million during the quarter, compared to analysts' expectations of $964.57 million. Cheesecake Factory had a return on equity of 43.74% and a net margin of 4.34%.Cheesecake Factory's revenue for the quarter was up 5.6% on a year-over-year basis. During the same period last year, the business posted $0.93 EPS. Sell-side analysts expect that The Cheesecake Factory Incorporated will post 4.01 EPS for the current fiscal year.

Cheesecake Factory Dividend Announcement

The firm also recently disclosed a quarterly dividend, which was paid on Tuesday, May 26th. Stockholders of record on Wednesday, May 13th were paid a $0.30 dividend. The ex-dividend date of this dividend was Wednesday, May 13th. This represents a $1.20 annualized dividend and a dividend yield of 1.5%. Cheesecake Factory's dividend payout ratio (DPR) is presently 35.09%.

Insider Buying and Selling

In related news, Director Alexander L. Cappello sold 2,490 shares of Cheesecake Factory stock in a transaction that occurred on Tuesday, June 2nd. The shares were sold at an average price of $64.90, for a total value of $161,601.00. Following the completion of the transaction, the director owned 6,171 shares in the company, valued at approximately $400,497.90. The trade was a 28.75% decrease in their ownership of the stock. The sale was disclosed in a document filed with the SEC, which is accessible through this hyperlink. Also, Chairman David Overton sold 104,000 shares of the company's stock in a transaction that occurred on Friday, May 1st. The stock was sold at an average price of $61.02, for a total transaction of $6,346,080.00. Following the sale, the chairman directly owned 3,079,779 shares in the company, valued at approximately $187,928,114.58. The trade was a 3.27% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. Insiders own 8.00% of the company's stock.

Institutional Investors Weigh In On Cheesecake Factory

Several hedge funds and other institutional investors have recently made changes to their positions in CAKE. Allspring Global Investments Holdings LLC raised its stake in Cheesecake Factory by 183.6% during the 4th quarter. Allspring Global Investments Holdings LLC now owns 133,921 shares of the restaurant operator's stock worth $7,072,000 after acquiring an additional 86,705 shares in the last quarter. Fisher Asset Management LLC grew its holdings in shares of Cheesecake Factory by 7.2% during the fourth quarter. Fisher Asset Management LLC now owns 503,184 shares of the restaurant operator's stock worth $25,401,000 after purchasing an additional 33,959 shares during the last quarter. 44 Wealth Management LLC purchased a new position in shares of Cheesecake Factory during the third quarter worth about $1,366,000. American Century Companies Inc. increased its position in shares of Cheesecake Factory by 5.6% during the third quarter. American Century Companies Inc. now owns 1,800,388 shares of the restaurant operator's stock worth $98,373,000 after purchasing an additional 96,074 shares in the last quarter. Finally, Picton Mahoney Asset Management increased its position in shares of Cheesecake Factory by 60,948.4% during the third quarter. Picton Mahoney Asset Management now owns 18,925 shares of the restaurant operator's stock worth $1,035,000 after purchasing an additional 18,894 shares in the last quarter. Institutional investors and hedge funds own 94.48% of the company's stock.

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.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.