Cheesecake Factory (NASDAQ:CAKE) Sets New 1-Year High - Still a Buy?

Key Points

• Cheesecake Factory shares reached a new 52-week high of $118.63, but the stock’s average analyst rating remains “Hold,” with a consensus price target of $90.33—well below its recent trading level.
• The company beat quarterly expectations, reporting $1.44 in earnings per share versus the $1.18 consensus estimate and $1.03 billion in revenue, up 7.7% year over year.
• Cheesecake Factory declared a quarterly dividend of $0.30, equal to a 1.0% annualized yield, while insiders sold approximately $22.3 million of stock over the past three months.

The Cheesecake Factory Incorporated (NASDAQ:CAKE - Get Free Report) hit a new 52-week high on Friday. The stock traded as high as $118.63 and last traded at $115.8150, with a volume of 155,394 shares. The stock had previously closed at $116.59.

Analysts Set New Price Targets

Several equities analysts recently commented on the company. Bank of America increased their target price on Cheesecake Factory from $66.00 to $79.00 and gave the company a "neutral" rating in a report on Thursday, July 2nd. Jefferies Financial Group lowered shares of Cheesecake Factory from a "buy" rating to a "hold" rating and increased their price target for the company from $75.00 to $88.00 in a research note on Wednesday, July 29th. UBS Group raised their price objective on shares of Cheesecake Factory from $53.00 to $60.00 and gave the stock a "sell" rating in a report on Thursday, July 23rd. Mizuho boosted their price objective on shares of Cheesecake Factory from $85.00 to $93.00 and gave the stock a "neutral" rating in a research report on Wednesday, July 29th. Finally, Morgan Stanley upped their target price on shares of Cheesecake Factory from $80.00 to $87.00 and gave the company an "equal weight" rating in a report on Thursday. One analyst has rated the stock with a Strong Buy rating, four have assigned a Buy rating, eleven have assigned a Hold rating and two have assigned a Sell rating to the company's stock. According to MarketBeat, Cheesecake Factory presently has an average rating of "Hold" and a consensus target price of $90.33.

Cheesecake Factory Stock Down 1.2%

The company has a quick ratio of 0.52, a current ratio of 0.59 and a debt-to-equity ratio of 1.08. The firm's fifty day moving average is $107.55 and its 200-day moving average is $84.16. The stock has a market capitalization of $5.73 billion, a PE ratio of 31.27, a PEG ratio of 1.84 and a beta of 1.04.

Cheesecake Factory (NASDAQ:CAKE - Get Free Report) last posted its quarterly earnings results on Tuesday, July 28th. The restaurant operator reported $1.44 earnings per share for the quarter, beating analysts' consensus estimates of $1.18 by $0.26. The firm had revenue of $1.03 billion for the quarter, compared to the consensus estimate of $999.54 million. Cheesecake Factory had a return on equity of 43.97% and a net margin of 4.61%. The company's revenue for the quarter was up 7.7% compared to the same quarter last year. During the same period in the previous year, the business earned $1.16 earnings per share. On average, equities research analysts predict that The Cheesecake Factory Incorporated will post 4.57 earnings per share for the current year.

Cheesecake Factory Dividend Announcement

The company also recently declared a quarterly dividend, which was paid on Tuesday, August 25th. Investors of record on Tuesday, August 11th were issued a $0.30 dividend. The ex-dividend date was Tuesday, August 11th. This represents a $1.20 dividend on an annualized basis and a dividend yield of 1.0%. Cheesecake Factory's dividend payout ratio is currently 32.52%.

Insider Buying and Selling

In other news, Director Janice L. Meyer sold 1,958 shares of Cheesecake Factory stock in a transaction on Monday, August 17th. The stock was sold at an average price of $109.36, for a total transaction of $214,126.88. Following the completion of the transaction, the director owned 21,251 shares of the company's stock, valued at $2,324,009.36. The trade was a 8.44% decrease in their position. The transaction was disclosed in a filing with the SEC, which is available through this hyperlink. Also, Director Edie A. Ames sold 3,000 shares of the business's stock in a transaction dated Monday, August 10th. The stock was sold at an average price of $106.95, for a total transaction of $320,850.00. Following the completion of the sale, the director owned 10,000 shares in the company, valued at $1,069,500. This represents a 23.08% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. Insiders have sold 213,749 shares of company stock valued at $22,301,899 in the last three months. 8.00% of the stock is owned by insiders.

Institutional Investors Weigh In On Cheesecake Factory

A number of large investors have recently bought and sold shares of CAKE. Dimensional Fund Advisors LP increased its position in Cheesecake Factory by 2.4% during the 1st quarter. Dimensional Fund Advisors LP now owns 1,242,143 shares of the restaurant operator's stock worth $68,008,000 after purchasing an additional 29,037 shares in the last quarter. Bank of New York Mellon Corp purchased a new position in Cheesecake Factory in the second quarter valued at approximately $38,020,000. Bamco Inc. NY purchased a new stake in Cheesecake Factory during the second quarter worth approximately $35,793,000. PDT Partners LLC acquired a new stake in shares of Cheesecake Factory in the second quarter worth $13,743,000. Finally, Palisade Capital Management LP purchased a new position in Cheesecake Factory in the second quarter valued at about $10,014,000. Institutional investors and hedge funds own 94.48% of the company's stock.

About Cheesecake Factory

Cheesecake Factory Incorporated NASDAQ: CAKE operates full-service restaurants known for extensive menus, generous portions and a broad selection of cheesecakes and other desserts. Its flagship brand, The Cheesecake Factory, serves American cuisine influenced by international flavors, including appetizers, salads, pastas, seafood, steaks, burgers and specialty beverages.

The company also operates restaurants under the North Italia brand, which specializes in modern Italian cuisine, and owns Fox Restaurant Concepts, a collection of restaurant brands with varied culinary themes.

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