Cheesecake Factory (NASDAQ:CAKE) Stock Rating Raised to “Strong-Buy” at Freedom Capital

Cheesecake Factory (NASDAQ:CAKE) was upgraded by analysts at Freedom Capital from a “hold” rating to a “strong-buy” rating in a research note issued to investors on Wednesday, Zacks reports.

CAKE has been the topic of several other research reports. Stephens reaffirmed an “equal weight” rating and set a $100.00 price target on shares of Cheesecake Factory in a research report on Wednesday. Wells Fargo & Company set a $116.00 price target on shares of Cheesecake Factory in a research note on Wednesday. Robert W. Baird upped their price objective on shares of Cheesecake Factory from $105.00 to $120.00 and gave the stock a “neutral” rating in a report on Thursday, October 22nd. Mizuho upped their price objective on shares of Cheesecake Factory from $93.00 to $110.00 and gave the stock a “neutral” rating in a report on Friday, October 23rd. Finally, Morgan Stanley increased their price objective on shares of Cheesecake Factory from $80.00 to $87.00 and gave the stock an “equal weight” rating in a research report on Thursday, October 15th. One research analyst has rated the stock with a Strong Buy rating, five have given a Buy rating, twelve have issued a Hold rating and two have issued a Sell rating to the company’s stock. According to data from MarketBeat.com, the company presently has a consensus rating of “Hold” and an average price target of $95.47.

Cheesecake Factory Stock Up 7.0%

Shares of CAKE opened at $113.12 on Wednesday. Cheesecake Factory has a 52-week low of $43.07 and a 52-week high of $118.63. The company has a market capitalization of $5.63 billion, a PE ratio of 26.81, a price-to-earnings-growth ratio of 1.48 and a beta of 1.04. The stock has a fifty day simple moving average of $107.90 and a two-hundred day simple moving average of $79.42. The company has a quick ratio of 0.52, a current ratio of 0.59 and a debt-to-equity ratio of 1.08.

Cheesecake Factory (NASDAQ:CAKE) last announced its quarterly earnings results on Tuesday, October 27th. The restaurant operator reported $1.02 earnings per share for the quarter, beating the consensus estimate of $0.96 by $0.06. Cheesecake Factory had a net margin of 5.20% and a return on equity of 46.95%. The firm had revenue of $1.03 billion for the quarter, compared to analysts’ expectations of $1.01 billion. During the same quarter in the previous year, the company posted $0.66 EPS. The company’s revenue was up 13.9% compared to the same quarter last year. As a group, equities analysts forecast that Cheesecake Factory will post 4.75 EPS for the current year.

Insider Buying and Selling at Cheesecake Factory

In related news, Chairman David Overton sold 94,145 shares of Cheesecake Factory stock in a transaction that occurred on Wednesday, August 5th. The shares were sold at an average price of $106.27, for a total value of $10,004,789.15. Following the completion of the transaction, the chairman owned 89,805 shares in the company, valued at approximately $9,543,577.35. The trade was a 51.18% decrease in their ownership of the stock. The sale was disclosed in a document filed with the SEC, which is accessible through this hyperlink. Also, Director Janice L. Meyer sold 1,958 shares of the stock in a transaction that occurred on Monday, August 17th. The stock was sold at an average price of $109.36, for a total transaction of $214,126.88. Following the sale, the director owned 21,251 shares in the company, valued at approximately $2,324,009.36. This trade represents a 8.44% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. Insiders sold a total of 131,176 shares of company stock worth $14,068,161 over the last ninety days. Company insiders own 8.00% of the company’s stock.

Institutional Inflows and Outflows

Several institutional investors and hedge funds have recently bought and sold shares of CAKE. Trek Financial LLC purchased a new position in shares of Cheesecake Factory in the 3rd quarter valued at about $1,464,000. Profund Advisors LLC acquired a new position in shares of Cheesecake Factory during the third quarter worth about $224,000. State of Wyoming increased its stake in shares of Cheesecake Factory by 60.3% during the third quarter. State of Wyoming now owns 1,920 shares of the restaurant operator’s stock worth $202,000 after buying an additional 722 shares during the period. VIRGINIA RETIREMENT SYSTEMS ET Al increased its stake in shares of Cheesecake Factory by 63.3% during the third quarter. VIRGINIA RETIREMENT SYSTEMS ET Al now owns 4,900 shares of the restaurant operator’s stock worth $516,000 after buying an additional 1,900 shares during the period. Finally, Choreo LLC raised its holdings in Cheesecake Factory by 7.0% in the third quarter. Choreo LLC now owns 7,173 shares of the restaurant operator’s stock valued at $755,000 after acquiring an additional 472 shares in the last quarter. 94.48% of the stock is owned by institutional investors and hedge funds.

Key Cheesecake Factory News

Here are the key news stories impacting Cheesecake Factory this week:

• Positive Sentiment: Strong traffic and earnings beat: Third-quarter revenue exceeded $1.033 billion, while flagship restaurant guest traffic increased 9.5%. CAKE reported $1.02 in EPS versus the $0.96 consensus estimate, and revenue grew 13.9% year over year. Cheesecake Factory: 3 Key Takeaways for Long-Term Investors
• Positive Sentiment: Expansion supports the longer-term outlook: Management highlighted improving margins, strong traffic and plans to expand the Flower Child concept in 2027, although North Italia remains a challenge. CAKE Q3 Earnings Call Highlights Strong Traffic and 2027 Expansion
• Positive Sentiment: Some analyst support remains: Citigroup maintained a Buy rating while trimming its price target slightly to $127, implying upside from the referenced price level. Citigroup stock recommendations
• Neutral Sentiment: Dividend maintained: CAKE declared a $0.30-per-share quarterly dividend, or $1.20 annualized, with a stated yield of approximately 1.1%. The ex-dividend date is November 10.
• Negative Sentiment: Valuation concerns are weighing on shares: Stephens reaffirmed an Equal Weight rating with a $100 target, while UBS maintained a Sell rating and an $80 target, arguing that the stock’s valuation is stretched. The move below the 50-day average followed an analyst downgrade. Cheesecake Factory stock crosses below 50 day moving average
• Neutral Sentiment: Political attention is generating publicity but little direct financial impact: Multiple reports focused on Barack Obama’s jokes about the chain and the resulting political backlash. The coverage may increase brand visibility, but it does not change CAKE’s earnings outlook or fundamentals.

Cheesecake Factory Company Profile

The Cheesecake Factory Incorporated is a restaurant company best known for The Cheesecake Factory, a full-service casual dining brand offering an extensive menu of American and international-inspired dishes, along with a broad selection of cheesecakes and other desserts. The company also operates North Italia, an Italian restaurant concept, and owns Fox Restaurant Concepts, which develops and operates additional restaurant brands, including Flower Child and Culinary Dropout.

The company was founded by David Overton, who opened the first Cheesecake Factory restaurant in Beverly Hills, California, in 1978 after his parents began a cheesecake business.