Momentum Stock Watch: The Cheesecake Factory Incorporated (CAKE)

Company Profile:

The Cheesecake Factory Incorporated operates restaurants in the United States. The company produces cheesecakes and other baked products for own restaurants and international licensees, as well as external foodservice operators, retailers, and distributors. As of February 28, 2018, it operated 214 company-owned restaurants, including 199 restaurants under The Cheesecake Factory brand; 13 restaurants under the Grand Lux Cafe brand; and 2 restaurants under the RockSugar Southeast Asian Kitchen brand, as well as 20 The Cheesecake Factory branded restaurants under licensing agreements internationally. The company was founded in 1972 and is headquartered in Calabasas, California.

Recent News:

May 11, 2018, the company announced the appointment of Scarlett May as Executive Vice President, General Counsel and Secretary of the Company. In addition, the Company named Keith T. Carango as President of The Cheesecake Factory Bakery Incorporated.

For the first quarter of fiscal 2018 ended on April 3, 2018, the company reported total revenues were $590.7 million as compared to $563.4 million in the first quarter of fiscal 2017. Net income and diluted net income per share were $26.0 million and $0.56, respectively.

 

Fundamental Analysis:

Ninestocks analyzes several different financial aspects: Growth, Profitability, solvency and efficiency.

Growth – Measures the growth of both the company’s income statement and cash flow.

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Profitability – Measures the historical price movement of the stock.

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Solvency – Measures the solvency of the company based on several ratios.

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Efficiency – Measures the strength and historic growth of a company’s return on invested capital.

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Conclusion:

CAKE’s strengths can be seen in its better growth, better profitablity and robust solvency compared with its peers. Its net income has increased over recent several years. Technical indicators signal the bullish signs, as there is a bullish crossover in Stochastic Oscillator. RSI is strong in the bullish zone and MACD is trying to cross back up. We rate The Cheesecake Factory Incorporated (CAKE) a STRONG BUY.

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