A $200 million CBRL share repurchase program is now underway
Cracker Barrel Old Country Store, Inc. (NASDAQ:CBRL) is an American chain of restaurant and gift stores. The restaurant chain and its affiliates operate more than 660 company-owned Cracker Barrel Old Country Store locations in 45 states and own the fast-casual Maple Street Biscuit Company. At last glance, CBRL is trading down 1.*% at $86.58.
In Cracker Barrel’s latest earnings report last month, they announced the authorization of a new share repurchase program of up to $200 million of CBRL's outstanding common stock. Cracker Barrel also declared a quarterly dividend of $1.30 per share on the company's common stock, placing their forward dividend at $5.20 and their dividend yield at an incredibly high 6.13%. The quarterly dividend will be paid on August 5 to shareholders of record as of July 15.
Cracker Barrel stock has decreased about 39% year-over-year and CBRL is currently trading down 41% since reaching a more than 52-week high of $150.64. Additionally, shares of CBRL have dropped in price 33% year-to-date and are down 14% just over the past month.
CBRL now provides a low valuation at a forward price-earnings ratio of 11.86 and a price-sales ratio of 0.62, making Cracker Barrel stock an intriguing option from both a value and dividend investors’ perspective.
This restaurant chain still comes with a high level of risk. Cracker Barrel currently owe $1.1 billion in total debt, which is just over half the company’s market cap of $2.01 billion. CBRL also holds just $24.77 million in cash on their balance sheet, indicating that their high dividend yield may be unsustainable. Still, Cracker Barrel stock offers an attractive opportunity from a risk-reward point of view.
Short interest has been on the rise, up 26.3% during the past two reporting periods. This accounts for 16.8% of the stock's total available float, or just over eight days worth of pent-up buying power.