Cracker Barrel to Report Q4 Earnings: Is a Beat in Store?

Cracker Barrel Old Country Store, Inc. CBRL is scheduled to report fourth-quarter fiscal 2024 results on Sept. 19. In the last reported quarter, CBRL registered an earnings surprise of 57.1%.

Trend in Estimate Revision

The Zacks Consensus Estimate for fiscal fourth-quarter earnings per share is pegged at $1.17, which indicates a deterioration of 34.6% from $1.79 reported in the year-ago quarter.

For revenues, the consensus mark is pegged at $898.8 million, which implies an increase of 7.4% from the year-ago quarter's reported figure.

Let's check out the factors that might have influenced CBRL's performance in the quarter to be reported.

Factors at Play for CBRL

Cracker Barrel's fiscal fourth-quarter top line is likely to have been aided by menu innovation, higher menu pricing, expansion and other sales-building efforts. Given the growing demand for its breakfast category, including Homestyle Chicken, French Toast, Barrel Bites and beverages, Cracker Barrel introduced its $5 take-home meals at the beginning of fiscal 2024, which is expected to have aided the company's top line.

The company is also benefiting from growth in off-premise sales. It continues to focus on off-premise initiatives, such as curbside delivery, third-party delivery and family meal baskets. These efforts are likely to have aided the off-premise sales.

Our model predicts Restaurant and Retail revenues to be $715.9 million and $168.2 million, respectively, up 7.9% and 6.9% year over year. However, dismal traffic and same-store sales are expected to have negatively impacted the company's results. Our model predicts retail same-store sales to decline 0.5% year over year. CBRL's retail business faces challenges stemming from broader industry pressures, particularly in discretionary categories.

Strategic investments in advertising and labor are likely to have increased costs and exerted margin pressure in the to-be-reported quarter. For fourth-quarter fiscal 2024, our model predicts labor and other related expenses  to rise 9% year over year to $332.6 million. We expect store-operating expenses to increase 8.4% year over year to $821.6 million. Our model predicts adjusted-operating income to decline 30.7% year over year to $27.6 million.

What Our Model Says

Our proven model predicts an earnings beat for Cracker Barrel this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. This is exactly the case here.

Earnings ESP: Cracker Barrel currently has an Earnings ESP of +2.74%.

Zacks Rank: The company has a Zacks Rank #2 at present.

Other Stocks Poised to Beat on Earnings

Here are some other stocks worth considering from the Zacks Retail-Wholesale sector, as our model shows that these, too, have the right combination of elements to beat on earnings this reporting cycle.

Domino's Pizza, Inc. DPZ currently has an Earnings ESP of +3.94% and a Zacks Rank #3. Shares of Domino's have risen 6.4% in the past year. DPZ's earnings beat the consensus mark in each of the trailing four quarters, delivering an average surprise of 11.2%.

Papa John's International, Inc. PZZA has an Earnings ESP of +2.11% and a Zacks Rank #3 at present. Shares of Papa John's have lost 32.9% in the past year. PZZA's earnings beat the consensus mark in three of the trailing four quarters and missed on one occasion, delivering an average surprise of 13.6%.

Starbucks Corporation SBUX currently has an Earnings ESP of +2.61% and a Zacks Rank #3. Shares of Starbucks have lost 0.5% in the past year. SBUX's earnings beat the consensus mark in two of the trailing four quarters and missed twice, delivering an average surprise of 1.7%.

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