Why Cracker Barrel Should Keep Rolling

Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, casual dining chain Cracker Barrel Old Country Store (Nasdaq: CBRL  ) has earned a coveted five-star ranking.

With that in mind, let's take a closer look at Cracker Barrel and see what CAPS investors are saying about the stock right now.

Cracker Barrel facts

Headquarters (Founded)

Lebanon, Tenn. (1969)

Market Cap

$1.4 billion

Industry

Restaurants

Trailing-12-Month Revenue

$2.6 billion

Management

CEO Sandra Cochran (since 2011)
CFO Lawrence Hyatt (since 2011)

Return on Equity (average, past 3 years)

36.9%

Cash/Debt

$118.9 million / $554.0 million

Dividend Yield

3.3%

Competitors

Denny's (Nasdaq: DENN  )
DineEquity
(NYSE: DIN  )
Waffle House

Sources: S&P Capital IQ and Motley Fool CAPS.

On CAPS, 87% of the 196 members who have rated Cracker Barrel believe the stock will outperform the S&P 500 going forward.

A couple of months ago, one of those bulls, fellow Fool Thomas Engle (TMF1000), succinctly summed up the outperform case for our community:

Cracker Barrel is a country styled casual dining restaurant. Its restaurants are along highways where traffic can be hurt by higher gas prices. Today they have 660 restaurants which is a fairly small store base considering Applebees has nearly 2000 stores. The company has room to grow and is working on a smaller store concept that will be cheaper to build and allow them to be more flexible when looking for store locations. I would like to see them diversify away from the highways. ...

It isn't going to be a fast grower like [Buffalo Wild Wings (Nasdaq: BWLD  ) ], but it is steady and it pays a nice dividend. Biglari/Cracker barrel proxy fight is costing them some money, but he does keep them on their toes, perhaps it evens out. I don't really want them to grow too fast. I like their disciplined approach. They offer a good value to customers and they are fairly small compared to other casual dining restaurants. I believe the growth will come.

If you want to retire rich, you need to put together the best portfolio you can. Owning exceptional stocks is a surefire way to secure your financial future. Of course, despite its five-star rating, Cracker Barrel may not be your top choice.

We've found another retailer we are incredibly excited about -- excited enough to dub it "The Motley Fool's Top Stock for 2012." We have compiled a special free report for investors to uncover this stock today. The report is 100% free, but it won't be here forever, so click here to access it now.

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