Russ...CBRL has NEVER I repeat NEVER in the history of the company traded at a P/E even in the ballpark of the current P/E...yes, the growth rate has slowed, the same-store-sales are trending slightly negative, but they still made over $100 Million net income last year and sales are still growing thanks to a continued expansion...many areas have put Cracker Barrel stores at Interstate exits in between 2 existing stores...so the business at the new store cuts into the existing business a bit...all stores are profitable and the company is more profitable than before but the existing stores are not quite as profitable than they were before the new store went up...that's the biggest thing that's going on, as I see it. Once the dust clears, the company is still making more money than they ever were, but due to the "cannibalization of existing stores" and the fact that you are starting from a larger store base each year, the rate of growth is not as impressive as it once was. Nonetheless, CBRL is still the best at what it does, they have a great product and loyal customers...the recent Logan's Roadhouse acquisition was an attempt to pick up another concept with high-growth potential...verdict is still out on that one, but I think it stands a good chance of working out.
CBRL is one that, IMO, you should buy, tuck away in an IRA if possible and not touch for a few years...I think you'll easily triple your money in the next 5 years with almost no downside risk...if so, that's not a bad return on your money.
Meanwhile, go support them at least once a week and get some good old-fashioned country cookin' !!!!
Jimbo. |
