CHEESECAKE FACTORY INC/THE (CAKE) Stock Fundamental Analysis
NASDAQ:CAKE - Nasdaq - US1630721017 - Common Stock - Currency: USD
We assign a fundamental rating of 5 out of 10 to CAKE. CAKE was compared to 134 industry peers in the Hotels, Restaurants & Leisure industry. CAKE has a medium profitability rating, but doesn't score so well on its financial health evaluation. CAKE has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
In the past year CAKE was profitable.
In the past year CAKE had a positive cash flow from operations.
CAKE had positive earnings in 4 of the past 5 years.
Each year in the past 5 years CAKE had a positive operating cash flow.
1.2 Ratios
Looking at the Return On Assets, with a value of 5.03%, CAKE is in the better half of the industry, outperforming 69.40% of the companies in the same industry.
Looking at the Return On Equity, with a value of 46.12%, CAKE belongs to the top of the industry, outperforming 92.54% of the companies in the same industry.
CAKE has a Return On Invested Capital (6.68%) which is in line with its industry peers.
CAKE had an Average Return On Invested Capital over the past 3 years of 5.05%. This is significantly below the industry average of 14.01%.
The 3 year average ROIC (5.05%) for CAKE is below the current ROIC(6.68%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.03% | ||
| ROE | 46.12% | ||
| ROIC | 6.68% |
ROA(3y)3.43%
ROA(5y)0.39%
ROE(3y)27.33%
ROE(5y)8.44%
ROIC(3y)5.05%
ROIC(5y)N/A
1.3 Margins
Looking at the Profit Margin, with a value of 4.33%, CAKE is in line with its industry, outperforming 55.97% of the companies in the same industry.
CAKE's Profit Margin has declined in the last couple of years.
Looking at the Operating Margin, with a value of 5.67%, CAKE is doing worse than 61.94% of the companies in the same industry.
In the last couple of years the Operating Margin of CAKE has remained more or less at the same level.
With an excellent Gross Margin value of 77.75%, CAKE belongs to the best of the industry, outperforming 92.54% of the companies in the same industry.
CAKE's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 5.67% | ||
| PM (TTM) | 4.33% | ||
| GM | 77.75% |
OM growth 3Y8.38%
OM growth 5Y1.18%
PM growth 3Y37.68%
PM growth 5Y-3.11%
GM growth 3Y-0.08%
GM growth 5Y0.03%
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 more shares outstanding than it did 1 year ago.
Compared to 5 years ago, CAKE has more shares outstanding
The debt/assets ratio for CAKE has been reduced compared to a year ago.
2.2 Solvency
CAKE has an Altman-Z score of 2.49. 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.
The Altman-Z score of CAKE (2.49) is better than 69.40% of its industry peers.
CAKE has a debt to FCF ratio of 5.55. This is a neutral value as CAKE would need 5.55 years to pay back of all of its debts.
CAKE has a Debt to FCF ratio of 5.55. This is amongst the best in the industry. CAKE outperforms 80.60% of its industry peers.
CAKE has a Debt/Equity ratio of 1.85. This is a high value indicating a heavy dependency on external financing.
With a Debt to Equity ratio value of 1.85, CAKE perfoms like the industry average, outperforming 56.72% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.85 | ||
| Debt/FCF | 5.55 | ||
| Altman-Z | 2.49 |
ROIC/WACC0.82
WACC8.16%
2.3 Liquidity
A Current Ratio of 0.53 indicates that CAKE may have some problems paying its short term obligations.
CAKE's Current ratio of 0.53 is on the low side compared to the rest of the industry. CAKE is outperformed by 74.63% of its industry peers.
A Quick Ratio of 0.43 indicates that CAKE may have some problems paying its short term obligations.
The Quick ratio of CAKE (0.43) is worse than 76.12% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.53 | ||
| Quick Ratio | 0.43 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 30.00% over the past year.
The Earnings Per Share has been growing slightly by 5.68% on average over the past years.
The Revenue has been growing slightly by 4.42% in the past year.
The Revenue has been growing slightly by 7.61% on average over the past years.
EPS 1Y (TTM)30%
EPS 3Y17.14%
EPS 5Y5.68%
EPS Q2Q%27.4%
Revenue 1Y (TTM)4.42%
Revenue growth 3Y6.95%
Revenue growth 5Y7.61%
Sales Q2Q%4.04%
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 10.84% yearly.
The Revenue is expected to grow by 4.87% on average over the next years.
EPS Next Y8.82%
EPS Next 2Y9.88%
EPS Next 3Y10.84%
EPS Next 5YN/A
Revenue Next Year5.19%
Revenue Next 2Y5.64%
Revenue Next 3Y5.93%
Revenue Next 5Y4.87%
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.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
CAKE is valuated correctly with a Price/Earnings ratio of 16.21.
Based on the Price/Earnings ratio, CAKE is valued a bit cheaper than the industry average as 78.36% of the companies are valued more expensively.
CAKE's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 26.32.
A Price/Forward Earnings ratio of 14.21 indicates a correct valuation of CAKE.
Based on the Price/Forward Earnings ratio, CAKE is valued a bit cheaper than 73.88% of the companies in the same industry.
CAKE's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 22.19.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.21 | ||
| Fwd PE | 14.21 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as CAKE.
Based on the Price/Free Cash Flow ratio, CAKE is valued a bit cheaper than the industry average as 67.91% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 25.85 | ||
| EV/EBITDA | 11.11 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The decent profitability rating of CAKE may justify a higher PE ratio.
PEG (NY)1.84
PEG (5Y)2.85
EPS Next 2Y9.88%
EPS Next 3Y10.84%
5. Dividend
5.1 Amount
CAKE has a Yearly Dividend Yield of 1.84%.
Compared to an average industry Dividend Yield of 3.59, CAKE pays a bit more dividend than its industry peers.
CAKE's Dividend Yield is slightly below the S&P500 average, which is at 2.40.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.84% |
5.2 History
On average, the dividend of CAKE grows each year by 7.51%, which is quite nice.
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 Years0
Div Non Decr Years2
5.3 Sustainability
CAKE pays out 33.67% of its income as dividend. This is a sustainable payout ratio.
CAKE's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP33.67%
EPS Next 2Y9.88%
EPS Next 3Y10.84%
59
-0.14 (-0.24%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryHotels, Restaurants & Leisure
Earnings (Last)
Earnings (Next)
Inst Owners112.08%
Inst Owner Change7.6%
Ins Owners8.08%
Ins Owner Change16.3%
Market Cap2.92B
Analysts74.07
Price Target56.48 (-4.27%)
Short Float %18.66%
Short Ratio6.33
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.84% |
Yearly Dividend1.04
Dividend Growth(5Y)7.51%
DP33.67%
Div Incr Years0
Div Non Decr Years2
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)11.64%
Min EPS beat(2)11.2%
Max EPS beat(2)12.08%
EPS beat(4)4
Avg EPS beat(4)11.78%
Min EPS beat(4)6.87%
Max EPS beat(4)16.98%
EPS beat(8)7
Avg EPS beat(8)7.68%
EPS beat(12)8
Avg EPS beat(12)-7.14%
EPS beat(16)9
Avg EPS beat(16)-7.45%
Revenue beat(2)0
Avg Revenue beat(2)-1.52%
Min Revenue beat(2)-1.99%
Max Revenue beat(2)-1.06%
Revenue beat(4)0
Avg Revenue beat(4)-1.89%
Min Revenue beat(4)-2.48%
Max Revenue beat(4)-1.06%
Revenue beat(8)0
Avg Revenue beat(8)-2.31%
Revenue beat(12)0
Avg Revenue beat(12)-2.52%
Revenue beat(16)1
Avg Revenue beat(16)-2.19%
PT rev (1m)1.11%
PT rev (3m)-3.05%
EPS NQ rev (1m)0.2%
EPS NQ rev (3m)-6.72%
EPS NY rev (1m)0%
EPS NY rev (3m)-1.03%
Revenue NQ rev (1m)-0.17%
Revenue NQ rev (3m)-1.06%
Revenue NY rev (1m)-0.03%
Revenue NY rev (3m)-0.73%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.21 | ||
| Fwd PE | 14.21 | ||
| P/S | 0.81 | ||
| P/FCF | 25.85 | ||
| P/OCF | 10.42 | ||
| P/B | 8.61 | ||
| P/tB | 33.5 | ||
| EV/EBITDA | 11.11 |
EPS(TTM)3.64
EY6.17%
EPS(NY)4.15
Fwd EY7.04%
FCF(TTM)2.28
FCFY3.87%
OCF(TTM)5.66
OCFY9.6%
SpS73.04
BVpS6.85
TBVpS1.76
PEG (NY)1.84
PEG (5Y)2.85
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.03% | ||
| ROE | 46.12% | ||
| ROCE | 8.46% | ||
| ROIC | 6.68% | ||
| ROICexc | 7.08% | ||
| ROICexgc | 7.95% | ||
| OM | 5.67% | ||
| PM (TTM) | 4.33% | ||
| GM | 77.75% | ||
| FCFM | 3.13% |
ROA(3y)3.43%
ROA(5y)0.39%
ROE(3y)27.33%
ROE(5y)8.44%
ROIC(3y)5.05%
ROIC(5y)N/A
ROICexc(3y)5.24%
ROICexc(5y)N/A
ROICexgc(3y)5.93%
ROICexgc(5y)N/A
ROCE(3y)6.39%
ROCE(5y)N/A
ROICexcg growth 3Y10.35%
ROICexcg growth 5Y5.82%
ROICexc growth 3Y11%
ROICexc growth 5Y8.1%
OM growth 3Y8.38%
OM growth 5Y1.18%
PM growth 3Y37.68%
PM growth 5Y-3.11%
GM growth 3Y-0.08%
GM growth 5Y0.03%
F-Score7
Asset Turnover1.16
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.85 | ||
| Debt/FCF | 5.55 | ||
| Debt/EBITDA | 2.04 | ||
| Cap/Depr | 162.91% | ||
| Cap/Sales | 4.63% | ||
| Interest Coverage | 20.11 | ||
| Cash Conversion | 91.07% | ||
| Profit Quality | 72.23% | ||
| Current Ratio | 0.53 | ||
| Quick Ratio | 0.43 | ||
| Altman-Z | 2.49 |
F-Score7
WACC8.16%
ROIC/WACC0.82
Cap/Depr(3y)148.68%
Cap/Depr(5y)115.39%
Cap/Sales(3y)4.13%
Cap/Sales(5y)3.45%
Profit Quality(3y)81.91%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)30%
EPS 3Y17.14%
EPS 5Y5.68%
EPS Q2Q%27.4%
EPS Next Y8.82%
EPS Next 2Y9.88%
EPS Next 3Y10.84%
EPS Next 5YN/A
Revenue 1Y (TTM)4.42%
Revenue growth 3Y6.95%
Revenue growth 5Y7.61%
Sales Q2Q%4.04%
Revenue Next Year5.19%
Revenue Next 2Y5.64%
Revenue Next 3Y5.93%
Revenue Next 5Y4.87%
EBIT growth 1Y32.53%
EBIT growth 3Y15.92%
EBIT growth 5Y8.87%
EBIT Next Year72.16%
EBIT Next 3Y26.92%
EBIT Next 5YN/A
FCF growth 1Y58.35%
FCF growth 3Y-9.76%
FCF growth 5Y-5.64%
OCF growth 1Y45.03%
OCF growth 3Y8%
OCF growth 5Y4.17%