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Will Cracker Barrel's Stronger Cash Flow Help Fund Future Investments?
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Key Takeaways
Cracker Barrel reduced total debt by $147.4 million year over year to $337.2 million.
CBRL expects $110-$125 million in fiscal 2027 capital expenditures, with 65% earmarked for maintenance.
Cracker Barrel projects $180-$200 million in adjusted EBITDA, with organic growth its top capital priority.
Cracker Barrel Old Country Store, Inc. (CBRL - Free Report) has made progress in strengthening its balance sheet, with lower debt and improved liquidity providing greater financial flexibility. The company is prioritizing investments in existing stores, food quality and technology while maintaining a conservative balance sheet. Its capital allocation strategy for fiscal 2027 reflects this focus on business improvements and long-term growth.
Cracker Barrel ended the fourth quarter of fiscal 2026 with total debt of $337.2 million, down $147.4 million from the prior-year level. The reduction followed the repayment of $150 million in convertible senior notes in June and a sale-leaseback transaction involving 26 company-owned stores. The transaction generated $77 million in net proceeds, which were used toward debt reduction. The company also ended the quarter with $541.3 million in available liquidity, while its revolving credit facility remained undrawn.
A stronger balance sheet provides room to fund planned investments without placing additional pressure on debt levels. For fiscal 2027, Cracker Barrel expects capital expenditures of $110-$125 million, with approximately 65% allocated to maintenance and the remaining 35% directed toward technology and other strategic initiatives. The company also plans to invest in food quality, improve store operations and strengthen the guest experience.
Cracker Barrel expects fiscal 2027 adjusted EBITDA of $180-$200 million and anticipates ample free cash flow to support business requirements. Organic growth remains the primary capital allocation priority, while dividend policy and future share repurchases remain under discussion with the board. This approach balances investment needs with financial discipline, keeping the focus on improving profitability and cash generation.
CBRL’s Price Performance, Valuation & Estimates
Cracker Barrel’s shares have gained 118.4% in the past year compared with the industry’s 1.2% rise. In the same time frame, other industry players like The Cheesecake Factory Incorporated (CAKE - Free Report) and BJ's Restaurants, Inc. (BJRI - Free Report) have surged 139% and 53.6%, respectively.
CBRL’s One-Year Price Performance
Image Source: Zacks Investment Research
From a valuation standpoint, CBRL trades at a forward price-to-sales (P/S) multiple of 0.43, below the industry’s average of 3.3. Conversely, industry players, such as Cheesecake Factory and BJ's Restaurants, have P/S multiples of 1.26 and 0.81, respectively.
CBRL’s P/S Ratio (Forward 12-Month) vs. Industry
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for CBRL’s fiscal 2027 earnings per share has increased in the past 60 days.
EPS Trend of CBRL Stock
Image Source: Zacks Investment Research
The company is likely to report strong earnings, with projections indicating a 95% rise in fiscal 2027. In comparison, industry players Cheesecake Factory and BJ's Restaurants are expected to witness earnings growth of 11.3% and 9.4%, respectively, in 2027.
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Will Cracker Barrel's Stronger Cash Flow Help Fund Future Investments?
Key Takeaways
Cracker Barrel Old Country Store, Inc. (CBRL - Free Report) has made progress in strengthening its balance sheet, with lower debt and improved liquidity providing greater financial flexibility. The company is prioritizing investments in existing stores, food quality and technology while maintaining a conservative balance sheet. Its capital allocation strategy for fiscal 2027 reflects this focus on business improvements and long-term growth.
Cracker Barrel ended the fourth quarter of fiscal 2026 with total debt of $337.2 million, down $147.4 million from the prior-year level. The reduction followed the repayment of $150 million in convertible senior notes in June and a sale-leaseback transaction involving 26 company-owned stores. The transaction generated $77 million in net proceeds, which were used toward debt reduction. The company also ended the quarter with $541.3 million in available liquidity, while its revolving credit facility remained undrawn.
A stronger balance sheet provides room to fund planned investments without placing additional pressure on debt levels. For fiscal 2027, Cracker Barrel expects capital expenditures of $110-$125 million, with approximately 65% allocated to maintenance and the remaining 35% directed toward technology and other strategic initiatives. The company also plans to invest in food quality, improve store operations and strengthen the guest experience.
Cracker Barrel expects fiscal 2027 adjusted EBITDA of $180-$200 million and anticipates ample free cash flow to support business requirements. Organic growth remains the primary capital allocation priority, while dividend policy and future share repurchases remain under discussion with the board. This approach balances investment needs with financial discipline, keeping the focus on improving profitability and cash generation.
CBRL’s Price Performance, Valuation & Estimates
Cracker Barrel’s shares have gained 118.4% in the past year compared with the industry’s 1.2% rise. In the same time frame, other industry players like The Cheesecake Factory Incorporated (CAKE - Free Report) and BJ's Restaurants, Inc. (BJRI - Free Report) have surged 139% and 53.6%, respectively.
CBRL’s One-Year Price Performance
Image Source: Zacks Investment Research
From a valuation standpoint, CBRL trades at a forward price-to-sales (P/S) multiple of 0.43, below the industry’s average of 3.3. Conversely, industry players, such as Cheesecake Factory and BJ's Restaurants, have P/S multiples of 1.26 and 0.81, respectively.
CBRL’s P/S Ratio (Forward 12-Month) vs. Industry
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for CBRL’s fiscal 2027 earnings per share has increased in the past 60 days.
EPS Trend of CBRL Stock
Image Source: Zacks Investment Research
The company is likely to report strong earnings, with projections indicating a 95% rise in fiscal 2027. In comparison, industry players Cheesecake Factory and BJ's Restaurants are expected to witness earnings growth of 11.3% and 9.4%, respectively, in 2027.
Cracker Barrel stock currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.