CHEESECAKE FACTORY INC/THE (CAKE) Stock Fundamental Analysis
NASDAQ:CAKE - Nasdaq - US1630721017 - Common Stock - Currency: USD
We assign a fundamental rating of 4 out of 10 to CAKE. CAKE was compared to 135 industry peers in the Hotels, Restaurants & Leisure industry. While CAKE is still in line with the averages on profitability rating, there are concerns on its financial health. CAKE is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
CAKE had positive earnings in the past year.
In the past year CAKE had a positive cash flow from operations.
The reported net income has been mixed in the past 5 years: CAKE reported negative net income in multiple years.
Of the past 5 years CAKE 4 years had a positive operating cash flow.
1.2 Ratios
CAKE has a Return On Assets of 4.37%. This is in the better half of the industry: CAKE outperforms 66.41% of its industry peers.
CAKE's Return On Equity of 32.37% is amongst the best of the industry. CAKE outperforms 87.02% of its industry peers.
CAKE has a Return On Invested Capital (6.13%) which is in line with its industry peers.
The Average Return On Invested Capital over the past 3 years for CAKE is significantly below the industry average of 10.79%.
The last Return On Invested Capital (6.13%) for CAKE is above the 3 year average (4.37%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.37% | ||
| ROE | 32.37% | ||
| ROIC | 6.13% |
ROA(3y)2.29%
ROA(5y)0.25%
ROE(3y)20.5%
ROE(5y)5.82%
ROIC(3y)4.37%
ROIC(5y)N/A
1.3 Margins
Looking at the Profit Margin, with a value of 3.63%, CAKE is in line with its industry, outperforming 51.91% of the companies in the same industry.
In the last couple of years the Profit Margin of CAKE has declined.
Looking at the Operating Margin, with a value of 5.01%, CAKE is doing worse than 63.36% of the companies in the same industry.
CAKE's Operating Margin has declined in the last couple of years.
CAKE has a Gross Margin of 77.34%. This is amongst the best in the industry. CAKE outperforms 92.37% of its industry peers.
In the last couple of years the Gross Margin of CAKE has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 5.01% | ||
| PM (TTM) | 3.63% | ||
| GM | 77.34% |
OM growth 3YN/A
OM growth 5Y-5.79%
PM growth 3YN/A
PM growth 5Y-7.04%
GM growth 3Y-0.16%
GM growth 5Y-0.13%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), CAKE is destroying value.
CAKE has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
2.2 Solvency
CAKE has an Altman-Z score of 2.53. This is not the best score and indicates that CAKE is in the grey zone with still only limited risk for bankruptcy at the moment.
CAKE's Altman-Z score of 2.53 is fine compared to the rest of the industry. CAKE outperforms 68.70% of its industry peers.
CAKE has a debt to FCF ratio of 6.92. This is a slightly negative value and a sign of low solvency as CAKE would need 6.92 years to pay back of all of its debts.
With a decent Debt to FCF ratio value of 6.92, CAKE is doing good in the industry, outperforming 69.47% of the companies in the same industry.
A Debt/Equity ratio of 1.19 is on the high side and indicates that CAKE has dependencies on debt financing.
With a decent Debt to Equity ratio value of 1.19, CAKE is doing good in the industry, outperforming 61.07% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.19 | ||
| Debt/FCF | 6.92 | ||
| Altman-Z | 2.53 |
ROIC/WACC0.69
WACC8.9%
2.3 Liquidity
CAKE has a Current Ratio of 0.44. This is a bad value and indicates that CAKE is not financially healthy enough and could expect problems in meeting its short term obligations.
CAKE's Current ratio of 0.44 is on the low side compared to the rest of the industry. CAKE is outperformed by 78.63% of its industry peers.
CAKE has a Quick Ratio of 0.44. This is a bad value and indicates that CAKE is not financially healthy enough and could expect problems in meeting its short term obligations.
The Quick ratio of CAKE (0.33) is worse than 79.39% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.44 | ||
| Quick Ratio | 0.33 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 28.36% over the past year.
The Earnings Per Share has been growing slightly by 5.68% on average over the past years.
EPS 1Y (TTM)28.36%
EPS 3Y17.14%
EPS 5Y5.68%
EPS Q2Q%30%
Revenue 1Y (TTM)N/A
Revenue growth 3YN/A
Revenue growth 5YN/A
Sales Q2Q%5.01%
3.2 Future
CAKE is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 9.47% yearly.
CAKE is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 4.88% yearly.
EPS Next Y9.96%
EPS Next 2Y9.97%
EPS Next 3Y9.47%
EPS Next 5YN/A
Revenue Next Year5.46%
Revenue Next 2Y5.93%
Revenue Next 3Y5.76%
Revenue Next 5Y4.88%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 15.89 indicates a correct valuation of CAKE.
Compared to the rest of the industry, the Price/Earnings ratio of CAKE indicates a rather cheap valuation: CAKE is cheaper than 80.15% of the companies listed in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 29.63, CAKE is valued a bit cheaper.
Based on the Price/Forward Earnings ratio of 14.45, the valuation of CAKE can be described as correct.
Compared to the rest of the industry, the Price/Forward Earnings ratio of CAKE indicates a rather cheap valuation: CAKE is cheaper than 83.97% of the companies listed in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 22.68, CAKE is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.89 | ||
| Fwd PE | 14.45 |
4.2 Price Multiples
CAKE's Enterprise Value to EBITDA is on the same level as the industry average.
The rest of the industry has a similar Price/Free Cash Flow ratio as CAKE.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 40.93 | ||
| EV/EBITDA | 11.68 |
4.3 Compensation for Growth
CAKE's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
PEG (NY)1.59
PEG (5Y)2.8
EPS Next 2Y9.97%
EPS Next 3Y9.47%
5. Dividend
5.1 Amount
CAKE has a Yearly Dividend Yield of 1.96%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 3.08, CAKE pays a bit more dividend than its industry peers.
CAKE's Dividend Yield is comparable with the S&P500 average which is at 2.27.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.96% |
5.2 History
The dividend of CAKE is nicely growing with an annual growth rate of 7.51%!
CAKE has paid a dividend for at least 10 years, which is a reliable track record.
CAKE has decreased its dividend in the last 3 years.
Dividend Growth(5Y)7.51%
Div Incr Years1
Div Non Decr Years2
5.3 Sustainability
41.24% of the earnings are spent on dividend by CAKE. This is a bit on the high side, but may be sustainable.
The dividend of CAKE is growing, but earnings are growing more, so the dividend growth is sustainable.
DP41.24%
EPS Next 2Y9.97%
EPS Next 3Y9.47%
54.65
-0.32 (-0.58%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryHotels, Restaurants & Leisure
Earnings (Last)
Earnings (Next)
Inst Owners100.08%
Inst Owner Change8.79%
Ins Owners6.78%
Ins Owner Change-7.85%
Market Cap2.79B
Analysts75
Price Target54.54 (-0.2%)
Short Float %13.99%
Short Ratio5.55
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.96% |
Yearly Dividend1.04
Dividend Growth(5Y)7.51%
DP41.24%
Div Incr Years1
Div Non Decr Years2
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)11.92%
Min EPS beat(2)6.87%
Max EPS beat(2)16.98%
EPS beat(4)4
Avg EPS beat(4)10.99%
Min EPS beat(4)6.87%
Max EPS beat(4)16.98%
EPS beat(8)6
Avg EPS beat(8)4.43%
EPS beat(12)6
Avg EPS beat(12)-11.3%
EPS beat(16)8
Avg EPS beat(16)-17.61%
Revenue beat(2)0
Avg Revenue beat(2)-2.26%
Min Revenue beat(2)-2.48%
Max Revenue beat(2)-2.04%
Revenue beat(4)0
Avg Revenue beat(4)-2.14%
Min Revenue beat(4)-2.48%
Max Revenue beat(4)-1.92%
Revenue beat(8)0
Avg Revenue beat(8)-2.61%
Revenue beat(12)0
Avg Revenue beat(12)-2.45%
Revenue beat(16)2
Avg Revenue beat(16)-2.5%
PT rev (1m)2.98%
PT rev (3m)24.06%
EPS NQ rev (1m)0.17%
EPS NQ rev (3m)0.17%
EPS NY rev (1m)0.03%
EPS NY rev (3m)0.07%
Revenue NQ rev (1m)-0.11%
Revenue NQ rev (3m)-0.11%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-0.03%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.89 | ||
| Fwd PE | 14.45 | ||
| P/S | 0.79 | ||
| P/FCF | 40.93 | ||
| P/OCF | 11.52 | ||
| P/B | 7.04 | ||
| P/tB | 19.32 | ||
| EV/EBITDA | 11.68 |
EPS(TTM)3.44
EY6.29%
EPS(NY)3.78
Fwd EY6.92%
FCF(TTM)1.34
FCFY2.44%
OCF(TTM)4.75
OCFY8.68%
SpS69.31
BVpS7.77
TBVpS2.83
PEG (NY)1.59
PEG (5Y)2.8
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.37% | ||
| ROE | 32.37% | ||
| ROCE | 7.76% | ||
| ROIC | 6.13% | ||
| ROICexc | 6.27% | ||
| ROICexgc | 7.07% | ||
| OM | 5.01% | ||
| PM (TTM) | 3.63% | ||
| GM | 77.34% | ||
| FCFM | 1.93% |
ROA(3y)2.29%
ROA(5y)0.25%
ROE(3y)20.5%
ROE(5y)5.82%
ROIC(3y)4.37%
ROIC(5y)N/A
ROICexc(3y)4.62%
ROICexc(5y)N/A
ROICexgc(3y)5.27%
ROICexgc(5y)N/A
ROCE(3y)5.53%
ROCE(5y)N/A
ROICexcg growth 3YN/A
ROICexcg growth 5Y-13.16%
ROICexc growth 3YN/A
ROICexc growth 5Y-14.8%
OM growth 3YN/A
OM growth 5Y-5.79%
PM growth 3YN/A
PM growth 5Y-7.04%
GM growth 3Y-0.16%
GM growth 5Y-0.13%
F-Score7
Asset Turnover1.21
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.19 | ||
| Debt/FCF | 6.92 | ||
| Debt/EBITDA | 1.71 | ||
| Cap/Depr | 175.74% | ||
| Cap/Sales | 4.92% | ||
| Interest Coverage | 13.32 | ||
| Cash Conversion | 87.7% | ||
| Profit Quality | 53.12% | ||
| Current Ratio | 0.44 | ||
| Quick Ratio | 0.33 | ||
| Altman-Z | 2.53 |
F-Score7
WACC8.9%
ROIC/WACC0.69
Cap/Depr(3y)120.72%
Cap/Depr(5y)100.8%
Cap/Sales(3y)3.39%
Cap/Sales(5y)3.16%
Profit Quality(3y)157.96%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)28.36%
EPS 3Y17.14%
EPS 5Y5.68%
EPS Q2Q%30%
EPS Next Y9.96%
EPS Next 2Y9.97%
EPS Next 3Y9.47%
EPS Next 5YN/A
Revenue 1Y (TTM)N/A
Revenue growth 3YN/A
Revenue growth 5YN/A
Sales Q2Q%5.01%
Revenue Next Year5.46%
Revenue Next 2Y5.93%
Revenue Next 3Y5.76%
Revenue Next 5Y4.88%
EBIT growth 1Y33.91%
EBIT growth 3YN/A
EBIT growth 5Y1.82%
EBIT Next Year94.14%
EBIT Next 3Y32.83%
EBIT Next 5Y25.35%
FCF growth 1Y-29.23%
FCF growth 3YN/A
FCF growth 5Y-18.87%
OCF growth 1Y25.7%
OCF growth 3Y322.3%
OCF growth 5Y-5.6%