Yahoo Finance With A -9.8% Earnings Drop, Is Cracker Barrel Old Country Store, Inc.'s (NASDAQ:CBRL) A Concern?
Today I will take a look at Cracker Barrel Old Country Store, Inc.'s (NasdaqGS:CBRL) most recent earnings update (02 August 2019) and compare these latest figures against its performance over the past few years, as well as how the rest of the hospitality industry performed. As an investor, I find it beneficial to assess CBRL’s trend over the short-to-medium term in order to gauge whether or not the company is able to meet its goals, and ultimately sustainably grow over time.
Check out our latest analysis for Cracker Barrel Old Country Store
Was CBRL weak performance lately part of a long-term decline?
CBRL's trailing twelve-month earnings (from 02 August 2019) of US$223m has declined by -9.8% compared to the previous year.
Furthermore, this one-year growth rate has been lower than its average earnings growth rate over the past 5 years of 11%, indicating the rate at which CBRL is growing has slowed down. Why is this? Well, let's look at what's going on with margins and if the entire industry is experiencing the hit as well.
In terms of returns from investment, Cracker Barrel Old Country Store has invested its equity funds well leading to a 37% return on equity (ROE), above the sensible minimum of 20%. Furthermore, its return on assets (ROA) of 15% exceeds the US Hospitality industry of 6.0%, indicating Cracker Barrel Old Country Store has used its assets more efficiently. However, its return on capital (ROC), which also accounts for Cracker Barrel Old Country Store’s debt level, has declined over the past 3 years from 25% to 24%.
What does this mean?
Though Cracker Barrel Old Country Store's past data is helpful, it is only one aspect of my investment thesis. Companies that are profitable, but have capricious earnings, can have many factors influencing its business. I recommend you continue to research Cracker Barrel Old Country Store to get a more holistic view of the stock by looking at:
Future Outlook: What are well-informed industry analysts predicting for CBRL’s future growth? Take a look at our free research report of analyst consensus for CBRL’s outlook.
Financial Health: Are CBRL’s operations financially sustainable? Balance sheets can be hard to analyze, which is why we’ve done it for you. Check out our financial health checks here.
Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.
NB: Figures in this article are calculated using data from the trailing twelve months from 02 August 2019. This may not be consistent with full year annual report figures.
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If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
