CBRL Group (CBRL), owners and operators of the Cracker Barrel Old Country Store and Logan’s Roadhouse brands, has been selected as one of the 11 best stock picks for 2003 by analysts representing Raymond James Financial.
Positive same-store sales in each of the last 11 quarters were a key reason Lebanon-based CBRL made the list. CBRL’s ability to leverage its positive sales to create accelerated margin growth at the store level was also emphasized in the report.
“It is important to note that the company is still some 300 to 400 basis points below historical levels,” wrote analyst Bryan Elliott. “We believe earnings-per-share can grow at 20 percent or better due to margin recovery. Street expectations appear to be in the 12 to 15 percent EPS growth range.”
Additionally, the report predicted that given CBRL’s approximately $55 million to $65 million in projected free cash for fiscal year 2003, combined with its below-peer balance sheet leverage, the company would continue with regular and aggressive stock buybacks.
The report stated a 2003 EPS estimate of $2.13 and a target price of $41.50.
CBRL shares last traded Thursday at $28.11.