Cracker Barrel Dishes Out Growth, Income


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Cracker Barrel Old Country Store ( CBRL ) offers customers country-style meals at affordable prices. For shareholders, it dishes out steady growth and a juicy dividend yield.

The Lebanon, Tenn.-based company runs about 624 restaurants in 42 states. Each restaurant has a gift shop where patrons can pick up toys, clothing and decorative items.

Cracker Barrel has posted higher earnings in the past six years. Growth has ranged from 4% to 25%. Over this period, profit has nearly doubled. Cracker Barrel has a five-year Earnings Stability Factor of 5, signaling a very steady stream of profits.

The company will report July-ended fiscal Q4 earnings Sept. 18. Analysts polled by Thomson Reuters see profit slipping 7% to $1.35 a share, but that's perhaps due to a tough comparison. Profit for fiscal Q4 2012 jumped sharply from a year ago. Earnings in fiscal 2011 were hurt by a number of charges.

Besides delivering long-term growth, Cracker Barrel has handed out higher dividends for investors. In June, the company hiked its quarterly dividend by 50% to 75 cents a share. Its quarterly dividend has tripled in just over a year.

On an annual basis, Cracker Barrel pays $3 a share. It has a yield of 3%, which is among the highest in the Retail-Restaurants group. Its yield is higher than that of the S&P 500, which stands at just under 2.5%.

Cracker Barrel has delivered big gains lately. Shares are up 60% year to date, about triple that of the S&P 500.

On Thursday, the stock briefly cleared a 103.05 buy point from an eight-week flat base and scored a record high in big volume. That's a sign of strong buying on a day when the general market indexes racked up modest losses.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

This article appears in: Investing Investing Ideas
Referenced Stocks: CBRL

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