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Cracker Barrel Dishes Out Growth, Income

By: Investor's Business Daily
Posted: 9/12/2013 5:49:00 PM
Referenced Stocks: CBRL

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.