The Cheesecake Factory's fourth quarter earnings and revenues
missed the Zacks Consensus Estimate by 1.7% and 1.6%, respectively.
However, both the metrics were up year over year. Despite being
impacted by inclement weather, comps remained flat year over year
at 0.9%. Going forward, we expect the company to remain well
positioned with its pricing actions, introduction of a new menu and
international expansion. However, continued underperformance of the
Grand Lux Caf , weak consumer spending and food cost inflation,
though expected to ease in 2014, remain concerns. Therefore, we
maintain our Neutral recommendation on the stock.
Founded in 1972 and based in Calabasas Hills, Calif., The
Cheesecake Factory Inc. (CAKE), operates upscale, casual, and
full-service dining restaurants in the United States. The company
operates 181 full-service, casual dining restaurants throughout the
U.S. and Puerto Rico, including 169 restaurants under The
Cheesecake Factory brand, 11 restaurants under the Grand Lux Cafe
brand and one restaurant under the RockSugar Pan Asian Kitchen
The company also has two bakery production facilities located in
Calabasas Hills, Calif. and Rocky Mount, N.C. These produce baked
desserts and other products for its restaurants, as well as for
other foodservice operators, retailers, and distributors. In
addition, it has three bakery cafes licensed under The Cheesecake
Factory Bakery Cafe name to another foodservice operator.
Currently, the company operates through two segments, The
Cheesecake Factory and Other.
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