Upscale casual dining restaurateur,
The Cheesecake Factory Incorporated
), is scheduled to report fourth-quarter fiscal 2013 results on
Feb 12, 2014 after the market close.
Last quarter, Cheesecake Factory posted a 1.96% positive
surprise. On an average, the company has posted a 1.67% positive
surprise in the last four quarters. Let's see how things are
shaping up for the fourth quarter.
Factors to Consider this Quarter
Although Cheesecake Factory beat the Zacks Consensus Estimate
for both earnings and revenues in the third quarter, its comps
growth has slowed down mostly due to underperformance at the
Grand Lux Café brand. Comp sales during the quarter declined 2.6%
at Grand Lux Café. Going forward, we believe that the brand's
performance will continue to be under pressure.
For the fourth quarter of 2013, earnings per share are guided
within the range of 57 cents - 60 cents. The Zacks Consensus
Estimate for the fourth-quarter is 58 cents. Estimates for the
fourth quarter have largely been revised downwards in the last 30
Management expects 2013 earnings per share within the
$2.10-$2.13 range. We would like to remind investors that at the
third-quarter conference call, the company tightened its earnings
per share guidance for 2013 anticipating lower external bakery
sales. In addition, a higher food cost environment may hurt
margin in the ensuing quarter.
However, our proven model does not conclusively show that
Cheesecake Factory will beat earnings this quarter. That is
because a stock needs to have both a positive
(Expected Surprise Prediction) and a Zacks Rank #1, 2 or 3 for
this to happen. That is not the case here as you will see
The ESP, which represents the difference between the Most
Accurate estimate and the Zacks Consensus Estimate, is 0.00%.
This is because both the estimates currently stand at 58
Cheesecake Factory carries a Zacks Rank #3 (Hold), which when
combined with a 0.00% ESP, makes surprise prediction
We caution against stocks with Zacks Ranks #4 and 5
(Sell-rated stocks) going into the earnings announcement,
especially when the company is seeing negative estimate
Other Stocks to Consider
Other stocks in the services sector that have both a positive
earnings ESP and a favorable Zacks Rank are:
Jack in the Box Inc.
), with Earnings ESP of + 1.54% and a Zacks Rank #2 (Buy).
Texas Roadhouse, Inc.
), with Earnings ESP of + 4.35% and a Zacks Rank #2 (Buy).
Melco Crown Entertainment Limited
), with Earnings ESP of + 7.50% and a Zacks Rank #1 (Strong
CHEESECAKE FACT (CAKE): Free Stock Analysis
JACK IN THE BOX (JACK): Free Stock Analysis
MELCO CROWN ENT (MPEL): Free Stock Analysis
TEXAS ROADHOUSE (TXRH): Free Stock Analysis
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