What: Shares of Cracker Barrel Old Country Store, Inc. (NASDAQ:CBRL) popped 13% in June, according to data from S&P Global Market Intelligence. As you can see from the chart below, those gains primarily came following the company's first-quarter earnings report on June 1.
So what: The casual-dining chain's shares jumped with the help of a special dividend of $3.25 a share announced in the report, and it also raised its quarterly dividend modestly to $1.15 from $1.10. As for the quarter past, the company saw a same-restaurant sales gain of 2.3% despite a hike in menu prices making up for a slight decline in traffic. Operating income improved by 140 basis points in the quarter to 9.6%, helped by lower commodity costs.
Now what: Looking ahead, Cracker Barrel upped its earnings-per-share guidance for the full year by $0.05, projecting adjusted earnings of $7.45-$7.55 per share and sees comparable sales growth in its restaurant and retail segments of 2% to 2.5%. It also said it expects to open five new stores this year, and anticipates flat commodity inflation.
Cracker Barrel has been a solid winner on the market as shares have more than tripled in the last five years, when some other casual-dining chains have struggled. While the slight decline in customer traffic may be a concern, management has been able to manage costs effectively and profit growth has been steady. I'd expect the stock to continue to rise.