Analyzing Denny's (DENN) and Cracker Barrel Old Country Store (CBRL)
Denny's (NASDAQ: DENN) and Cracker Barrel Old Country Store (NASDAQ:CBRL) are both cyclical consumer goods & services companies, but which is the better investment? We will contrast the two companies based on the strength of their valuation, dividends, institutional ownership, risk, earnings, profitability and analyst recommendations.
This table compares Denny's and Cracker Barrel Old Country Store’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Cracker Barrel Old Country Store||6.83%||35.14%||13.08%|
This is a breakdown of current recommendations for Denny's and Cracker Barrel Old Country Store, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Cracker Barrel Old Country Store||1||8||0||0||1.89|
Denny's currently has a consensus price target of $12.67, suggesting a potential downside of 13.54%. Cracker Barrel Old Country Store has a consensus price target of $156.86, suggesting a potential downside of 4.95%. Given Cracker Barrel Old Country Store’s higher probable upside, analysts plainly believe Cracker Barrel Old Country Store is more favorable than Denny's.
Institutional and Insider Ownership
91.0% of Denny's shares are held by institutional investors. Comparatively, 89.4% of Cracker Barrel Old Country Store shares are held by institutional investors. 5.2% of Denny's shares are held by insiders. Comparatively, 0.9% of Cracker Barrel Old Country Store shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.
Valuation & Earnings
This table compares Denny's and Cracker Barrel Old Country Store’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Denny's||$506.95 million||1.89||$19.40 million||$0.52||28.17|
|Cracker Barrel Old Country Store||$2.93 billion||1.35||$201.89 million||$8.29||19.91|
Cracker Barrel Old Country Store has higher revenue and earnings than Denny's. Cracker Barrel Old Country Store is trading at a lower price-to-earnings ratio than Denny's, indicating that it is currently the more affordable of the two stocks.
Cracker Barrel Old Country Store pays an annual dividend of $4.80 per share and has a dividend yield of 2.9%. Denny's does not pay a dividend. Cracker Barrel Old Country Store pays out 57.9% of its earnings in the form of a dividend. Denny's has increased its dividend for 8 consecutive years.
Risk and Volatility
Denny's has a beta of 0.67, indicating that its share price is 33% less volatile than the S&P 500. Comparatively, Cracker Barrel Old Country Store has a beta of 0.56, indicating that its share price is 44% less volatile than the S&P 500.
Denny's beats Cracker Barrel Old Country Store on 11 of the 17 factors compared between the two stocks.
Denny's Company Profile
Denny’s Corporation (Denny’s) operates a franchised full-service restaurant chain. The Company, through its subsidiary, Denny’s, Inc., owns and operates the Denny’s brand. As of December 28, 2016, the Denny’s brand consisted of 1,733 franchised, licensed and Company-operated restaurants around the world, including 1,610 restaurants in the United States and 123 international locations. As of December 28, 2016, 1,564 of its restaurants were franchised or licensed and 169 were Company-operated. In addition to its breakfast-all-day items, Denny’s offers a selection of lunch and dinner items, including burgers, sandwiches, salads and skillet entrees, along with an assortment of beverages, appetizers and desserts. The Company’s Fit Fare menu helps its guests identify items suited to their dietary needs. Most Denny’s restaurants offer special items for children and seniors. The Company has restaurant locations within travel centers, primarily with Pilot and Pilot Flying J Travel Centers.
Cracker Barrel Old Country Store Company Profile
Cracker Barrel Old Country Store, Inc. is engaged in the operation and development of the Cracker Barrel Old Country Store concept (Cracker Barrel). The Company’s segments include Restaurant and Retail. As of September 19, 2016, the Company operated 640 Cracker Barrel stores in 43 states. The format of its stores consists of a rustic old country-store design offering a restaurant menu that features home-style country food and a range of decorative and functional items, such as rocking chairs, holiday and seasonal gifts and toys, apparel, cookware and foods. Its restaurants offer home-style country cooking featuring of its own recipes. Its restaurants serve breakfast, lunch and dinner. Its breakfast items include juices, eggs, pancakes, grits, and a range of biscuit specialties. Its lunch and dinner items include country ham, chicken and dumplings, chicken fried chicken, meatloaf, fresh side items and specialty items, such as pinto beans and turnip greens.
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