Sonic Corp. (NASDAQ:SONC) was upgraded by Zacks Investment Research from a “sell” rating to a “buy” rating in a research report issued to clients and investors on Wednesday. The firm currently has a $26.00 target price on the restaurant operator’s stock. Zacks Investment Research‘s target price points to a potential upside of 8.83% from the stock’s current price.
According to Zacks, “Sonic Corp. operates and franchises one of the largest chain of drive-in restaurants in the United States. Sonic restaurants offer made-to-order hamburgers and other sandwiches and feature Sonic signature items, such as footlong coney cheese dogs, hand-battered onion rings, tater tots, specialty soft drinks, including cherry limeades and slushes, and frozen desserts. At a typical Sonic restaurant, a customer drives into one of 24 to 36 covered drive-in spaces, orders through an intercom, and has the food delivered by a carhop within an average of four minutes. “
A number of other research firms have also recently commented on SONC. Bank of America Corporation cut Sonic Corp. from a “buy” rating to an “underperform” rating and lifted their target price for the stock from $27.00 to $30.00 in a research report on Tuesday, June 13th. BidaskClub cut Sonic Corp. from a “strong-buy” rating to a “buy” rating in a research report on Saturday, June 17th. Wells Fargo & Company assumed coverage on Sonic Corp. in a research report on Tuesday, May 23rd. They set a “market perform” rating and a $30.00 target price on the stock. Stephens reiterated an “overweight” rating and set a $32.00 target price on shares of Sonic Corp. in a research report on Monday, June 26th. Finally, Oppenheimer Holdings, Inc. reiterated an “outperform” rating and set a $29.00 target price on shares of Sonic Corp. in a research report on Monday, June 26th. Three analysts have rated the stock with a sell rating, nine have issued a hold rating and five have issued a buy rating to the company’s stock. Sonic Corp. currently has an average rating of “Hold” and a consensus target price of $27.46.
Shares of Sonic Corp. (SONC) opened at 23.89 on Wednesday. Sonic Corp. has a 1-year low of $21.12 and a 1-year high of $30.05. The stock has a market cap of $998.82 million, a P/E ratio of 15.93 and a beta of 1.77. The firm’s 50-day moving average price is $23.70 and its 200 day moving average price is $25.77.
Sonic Corp. (NASDAQ:SONC) last posted its earnings results on Thursday, June 22nd. The restaurant operator reported $0.43 EPS for the quarter, topping the Zacks’ consensus estimate of $0.41 by $0.02. Sonic Corp. had a negative return on equity of 44.21% and a net margin of 13.23%. The business had revenue of $124.00 million for the quarter, compared to analysts’ expectations of $122.58 million. During the same quarter in the previous year, the firm earned $0.43 earnings per share. The business’s revenue was down 24.9% compared to the same quarter last year. On average, equities analysts expect that Sonic Corp. will post $1.24 earnings per share for the current fiscal year.
Sonic Corp. announced that its Board of Directors has authorized a share buyback plan on Wednesday, August 9th that allows the company to repurchase $160.00 million in outstanding shares. This repurchase authorization allows the restaurant operator to reacquire up to 16.2% of its shares through open market purchases. Shares repurchase plans are often a sign that the company’s management believes its shares are undervalued.
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In other Sonic Corp. news, Director Steven A. Davis acquired 2,000 shares of the stock in a transaction on Wednesday, September 6th. The shares were bought at an average price of $23.00 per share, with a total value of $46,000.00. The acquisition was disclosed in a legal filing with the SEC, which is available at this link. Insiders acquired a total of 5,000 shares of company stock worth $117,730 in the last ninety days. 6.24% of the stock is owned by corporate insiders.
A number of institutional investors and hedge funds have recently made changes to their positions in SONC. Riverhead Capital Management LLC boosted its holdings in Sonic Corp. by 77.7% in the 2nd quarter. Riverhead Capital Management LLC now owns 4,797 shares of the restaurant operator’s stock valued at $127,000 after purchasing an additional 2,097 shares in the last quarter. Flinton Capital Management LLC boosted its holdings in Sonic Corp. by 74.5% in the 2nd quarter. Flinton Capital Management LLC now owns 6,290 shares of the restaurant operator’s stock valued at $167,000 after purchasing an additional 2,686 shares in the last quarter. Karp Capital Management Corp purchased a new stake in Sonic Corp. in the 1st quarter valued at approximately $209,000. LSV Asset Management purchased a new stake in Sonic Corp. in the 1st quarter valued at approximately $218,000. Finally, State of Alaska Department of Revenue boosted its holdings in Sonic Corp. by 72.7% in the 2nd quarter. State of Alaska Department of Revenue now owns 8,378 shares of the restaurant operator’s stock valued at $221,000 after purchasing an additional 3,528 shares in the last quarter.
Sonic Corp. Company Profile
Sonic Corp. operates and franchises the chain of drive-thru restaurants (Sonic Drive-Ins) in the United States. As of August 31, 2016, 3,557 Sonic Drive-Ins were in operation from coast to coast in 45 states, consisting of 345 Company drive-thrus and 3,212 franchise drive-thrus. As of August 31, 2016, its restaurant design and construction consisted of a kitchen housed in a one-story building, which was approximately 1,500 square feet, flanked by canopy-covered rows of 16 to 24 parking spaces, with each space having its own payment terminal, intercom speaker system and menu board.
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