The 10-second takeaway
For the quarter ended July 3 (Q2), Cheesecake Factory met expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue grew and GAAP earnings per share grew significantly.
Margins increased across the board.
Cheesecake Factory notched revenue of $454.7 million. The 22 analysts polled by S&P Capital IQ anticipated a top line of $456.9 million on the same basis. GAAP reported sales were 5.6% higher than the prior-year quarter's $430.7 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.51. The 23 earnings estimates compiled by S&P Capital IQ anticipated $0.49 per share. GAAP EPS of $0.52 for Q2 were 24% higher than the prior-year quarter's $0.42 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 43.5%, 140 basis points better than the prior-year quarter. Operating margin was 9.0%, 80 basis points better than the prior-year quarter. Net margin was 6.2%, 50 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $459.1 million. On the bottom line, the average EPS estimate is $0.47.
Next year's average estimate for revenue is $1.83 billion. The average EPS estimate is $1.88.
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 500 members out of 633 rating the stock outperform, and 133 members rating it underperform. Among 189 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 165 give Cheesecake Factory a green thumbs-up, and 24 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Cheesecake Factory is hold, with an average price target of $33.68.
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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.