The cozy front-porch chairs aren't the only thing rocking at Cracker Barrel today. Shares of parent company CBRL Group
CBRL has tried to grow shareholder value over the years through dividend hikes and aggressive stock buybacks, but slow top- and bottom-line growth has kept the shares in check. Earnings grew by 12% in fiscal 2005 after moving just 6% higher a year earlier. Sales haven't risen by more than 8% during any of the last four years.
The move doesn't mean that CBRL will cash out, though the message is now clear to any rival casual dining chain or private equity firm that may have an interest in owning the colorful chain serving up country vittles alongside its rustic gift shops.
Absent a buyout, CBRL may be tempted to spin off Logan's Roadhouse. The similarly themed Texas Roadhouse
Before CBRL acquired Logan's, it was a growth-stock darling, sporting healthier unit economics than larger casual steakhouse chains like Outback
I think a buyout is likely, though. Like a tempting fruit cobbler or a crafty roadside trinket, CRBL Group on sale may be too good a deal for someone else to pass up.
Longtime Fool contributor Rick Munarriz is a fan of both Cracker Barrel and Logan's Roadhouse, and one of the many who find it hard to a Cracker Barrel billboard advertising country eats at the next interstate exit. He owns seven, count 'em, seven shares in CBRL Group. T he Fool has a disclosure policy. Rick is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early.