Cracker Barrel (CBRL) Stock Jumps 11% After Surprise Profit Beat

TLDR

• CBRL stock jumped 11% in premarket trading after a surprise quarterly profit
• Adjusted EPS came in at 29 cents vs. an expected loss of 48 cents
• Revenue of $797.4 million beat the $776.7 million analyst estimate
• Full-year revenue outlook raised to $3.27B–$3.3B from $3.24B–$3.27B
• Adjusted EBITDA guidance lifted to $120M–$125M, up from $85M–$100M

Cracker Barrel (CBRL) stock surged 11% in premarket trading Wednesday after the restaurant chain posted a surprise profit and raised its full-year outlook.

Cracker Barrel Old Country Store, Inc., CBRL

The stock closed Tuesday at $36.30, already up 43% year-to-date, and gained a further 8% in after-hours trading to $39.20 following the results.

For its fiscal third quarter, Cracker Barrel reported adjusted earnings of 29 cents a share. Analysts had been bracing for an adjusted loss of 48 cents. That’s a big swing.

On a reported basis, the company posted a profit of $42.8 million, or $1.90 a share, compared with $12.6 million, or 56 cents a share, a year earlier. The reported figure included a $47.4 million litigation settlement.

Revenue came in at $797.4 million, down from $821.1 million a year prior but above the $776.7 million Wall Street had expected.

Sales Still Declining, but the Trend Is Improving

Comparable store restaurant sales fell 2.6% and overall same-store sales dropped 1.8% year over year. Traffic was down about 6.7% during the quarter.

Those are still negative numbers, but they’re a marked recovery from the 8.5% and 7.9% comparable sales drops in the prior two quarters — when the logo fallout was at its worst.

The retail segment outperformed restaurant sales for the first time in more than four years, the company noted.

CEO Julie Masino told analysts the average check was $15.85, up 4.3% year over year, still below casual and family dining averages. She said menu changes have been made to strengthen value. CFO Craig Pommells said the company is “encouraged by the gradual improvements in the underlying traffic trend.”

The company’s Google Star rating rose 4% year over year to its highest level since 2018.

Guidance Gets a Lift

Profitability during the quarter was driven by cost management, including a corporate restructuring completed in the second quarter expected to generate $20 million to $25 million in annualized savings.

Cracker Barrel now expects full-year revenue of $3.27 billion to $3.3 billion, raised from the prior range of $3.24 billion to $3.27 billion. Analysts had been forecasting $3.25 billion.

Adjusted EBITDA guidance was lifted to $120 million–$125 million, up from the previous $85 million–$100 million range. The analyst consensus had been sitting at $92.7 million.

The company reinstated its old logo and brought back some original cooking processes, including freshly rolled and baked biscuits, after the backlash from its short-lived rebrand.

CBRL stock remains down 35% over the last 12 months despite the year-to-date recovery.

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