Back to top

Analyst Blog

The Cheesecake Factory Inc. , one of the most recognized upscale casual dining restaurant in the U.S. operating since 1972, has been on an expansion spree for quite some time. With the resurgence of consumer confidence, management plans to unveil another nine units in 2013 on the national front.

The restaurateur recently unveiled the third restaurant in San Diego, California. The 9,780 square-feet restaurant, located in The Headquarters at Seaport District, can accommodate around 270 diners at a time.

Cheesecake Factory’s restaurants are primarily located in or near malls and shopping centers to attract upper-class customers. The Headquarters, positioned in downtown San Diego and at the waterfront, is a major entertainment hub and boasts restaurants, retail shops and other entertainment activities.

California is the home-court of Cheesecake Factory and offers plenty of growth opportunities. According to the National Restaurant Association, the restaurant industry of California acts as a major catalyst to its economic development. The state’s restaurant industry is projected to generate around $67.4 billion in revenues in 2013. Consistently growing demand and high spending ability of the state are favorable to its restaurant sector’s growth. We believe that these factors have encouraged Cheesecake Factory to explore further in its home state.

We believe that the opening of the new restaurant in California, with its attractive menu, strategic location and contemporary ambience will help the company drive traffic, going ahead.

Other Stocks to Consider

Cheesecake Factory holds a Zacks Rank #3 (Hold). Some other players in the restaurant industry which look attractive at present include Cracker Barrel Old Country Store, Inc. , DineEquity, Inc. and Bob Evans Farms, Inc. . All these companies hold a Zacks Rank #2 (Buy).

Please login to Zacks.com or register to post a comment.