Cheesecake Factory (NASDAQ:CAKE) Sets New 1-Year High - Here's Why

Key Points

• Cheesecake Factory shares hit a new 52-week high, trading as high as $69.82 and last around $70.01. The move came amid relatively light volume and pushed the stock well above its recent average trading levels.
• The company’s latest quarterly results were better than expected, with EPS of $1.05 versus the $1.03 estimate and revenue of $978.83 million topping forecasts. Revenue also rose 5.6% year over year.
• Wall Street remains cautious overall: analysts have a consensus “Hold” rating and average price target of $64.94, even though some firms recently raised their targets. The stock also pays a quarterly dividend of $0.30 per share, yielding about 1.7%.

The Cheesecake Factory Incorporated (NASDAQ:CAKE - Get Free Report) shares reached a new 52-week high during mid-day trading on Wednesday . The company traded as high as $69.82 and last traded at $70.0120, with a volume of 36902 shares. The stock had previously closed at $67.94.

Wall Street Analyst Weigh In

A number of equities analysts recently issued reports on the stock. Deutsche Bank Aktiengesellschaft reissued a "hold" rating and issued a $68.00 price objective on shares of Cheesecake Factory in a report on Thursday, April 30th. Oppenheimer raised their price objective on shares of Cheesecake Factory from $68.00 to $72.00 and gave the stock an "outperform" rating in a report on Tuesday, April 21st. Robert W. Baird set a $65.00 price target on Cheesecake Factory in a research report on Thursday, April 30th. UBS Group set a $53.00 price target on Cheesecake Factory and gave the stock a "sell" rating in a research report on Friday, February 20th. Finally, Barclays upped their price target on Cheesecake Factory from $58.00 to $60.00 and gave the stock an "underweight" rating in a research report on Thursday, April 30th. Six investment analysts have rated the stock with a Buy rating, nine have assigned a Hold rating and three have given a Sell rating to the stock. According to data from MarketBeat, the company has an average rating of "Hold" and a consensus price target of $64.94.

Cheesecake Factory Price Performance

The company has a quick ratio of 0.53, a current ratio of 0.59 and a debt-to-equity ratio of 1.22. The firm has a market cap of $3.51 billion, a PE ratio of 20.58, a P/E/G ratio of 1.61 and a beta of 1.04. The firm's fifty day simple moving average is $61.03 and its two-hundred day simple moving average is $57.85.

Cheesecake Factory (NASDAQ:CAKE - Get Free Report) last issued its quarterly earnings results on Wednesday, April 29th. The restaurant operator reported $1.05 earnings per share for the quarter, beating the consensus estimate of $1.03 by $0.02. Cheesecake Factory had a net margin of 4.34% and a return on equity of 43.74%. The business had revenue of $978.83 million for the quarter, compared to the consensus estimate of $964.57 million. During the same quarter in the previous year, the firm earned $0.93 earnings per share. The company's revenue for the quarter was up 5.6% on a year-over-year basis. As a group, research analysts expect that The Cheesecake Factory Incorporated will post 4.01 EPS for the current year.

Cheesecake Factory Announces Dividend

The company also recently declared a quarterly dividend, which was paid on Tuesday, May 26th. Shareholders of record on Wednesday, May 13th were issued a dividend of $0.30 per share. The ex-dividend date of this dividend was Wednesday, May 13th. This represents a $1.20 annualized dividend and a yield of 1.7%. Cheesecake Factory's payout ratio is currently 35.09%.

Insider Activity at Cheesecake Factory

In other Cheesecake Factory news, Chairman David Overton sold 104,000 shares of Cheesecake Factory stock in a transaction that occurred on Friday, May 1st. The shares were sold at an average price of $61.02, for a total transaction of $6,346,080.00. Following the transaction, the chairman owned 3,079,779 shares of the company's stock, valued at $187,928,114.58. The trade was a 3.27% decrease in their ownership of the stock. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is available through the SEC website. Also, 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 transaction of $161,601.00. Following the transaction, the director directly owned 6,171 shares in the company, valued at $400,497.90. This represents a 28.75% decrease in their position. The SEC filing for this sale provides additional information. 8.00% of the stock is owned by insiders.

Hedge Funds Weigh In On Cheesecake Factory

Several hedge funds have recently modified their holdings of CAKE. Salomon & Ludwin LLC lifted 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 worth $33,000 after buying an additional 419 shares in the last quarter. Global Retirement Partners LLC lifted its holdings in shares of Cheesecake Factory by 661.7% in the fourth quarter. Global Retirement Partners LLC now owns 716 shares of the restaurant operator's stock worth $36,000 after buying an additional 622 shares in the last quarter. NFSG Corp lifted its holdings in shares of Cheesecake Factory by 115.8% in the first quarter. NFSG Corp now owns 682 shares of the restaurant operator's stock worth $37,000 after buying an additional 366 shares in the last quarter. Root Financial Partners LLC lifted its holdings in shares of Cheesecake Factory by 973.2% in the fourth quarter. Root Financial Partners LLC now owns 880 shares of the restaurant operator's stock worth $44,000 after buying an additional 798 shares in the last quarter. Finally, Arax Advisory Partners purchased a new position in shares of Cheesecake Factory in the fourth quarter worth $50,000. Hedge funds and other institutional investors 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.

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