CBRL

Labor and the Economic Cycle

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As we arguably near the “peak” in the business cycle, labor is starting to demand more, a dynamic that we believe is emblematic of the period of aging economic expansion. Let’s have a look at what’s happening in the fight for higher wages. By Brian Nelson, CFA Each business cycle is different in both magnitude and duration, but there are some common qualities that define where an economy might be within the cycle. First, it has been more than 8 years since the March 2009 stock-market panic bottom, a period that witnessed firms such as Lehman Brothers, Bear Stearns, and AIG (AIG) flounder. The unemployment rate peaked at 10% during that difficult time. Since then, the US economy has emerged … Read more

Dividend Increases/Decreases for the Week Ending May 26

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Below we provide a list of firms that raised/lowered their dividends during the week ending May 26. The dividend reports of covered firms on this list will be updated shortly with the new information. To access our dividend reports use the ‘Symbol’ search box in our website header. Firms Raising Their Dividends This Week Advanced Drainage Systems (WMS): now $0.07 per share quarterly dividend, was $0.06. Agree Realty (ADC): now $0.505 per share quarterly dividend, was $0.495. Bank of Montreal (BMO): now CAD 0.90 per share quarterly dividend, was CAD 0.88. Bunge (BG): now $0.46 per share quarterly dividend, was $0.42. China Yuchai (CYD): now $0.90 per share annual dividend, was $0.85. Clipper Realty (CLPR): now $0.095 per share quarterly … Read more

Cracker Barrel Hits the Trifecta!

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Image Source: Mike Mozart Cracker Barrel increased its full-year earnings guidance, raised its regular dividend, and issued a special payout. The market was pleased. By Brian Nelson, CFA Dividend Growth Newsletter portfolio holding Cracker Barrel (CBRL) released fiscal third-quarter results May 23 that came in above the company’s internal expectations, leading the unique restaurant concept to raise its full-year profit target. It now expects earnings per share for fiscal 2017 to be in the range of $8.25-$8.35, above its previous target of $8.10-$8.25 and ahead of consensus expectations. Of course we liked this news, and we continue to believe Cracker Barrel is one of the best dividend growth ideas in all of the restaurant space, from quick service to fast … Read more

Valuentum’s 3 Breakthroughs in the Field of Finance and More

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Valuentum’s President Brian Nelson pauses for a picture before speaking at the CFA Society of Houston in March 2017. By Valuentum Editorial Staff Let’s cover Valuentum’s 3 major breakthroughs in the field of finance. The first one is big and may challenge you to rethink everything you think you know about investing. 1. On a logical framework, Valuentum has debunked John C. Bogle’s landmark syllogism that has paved the way for the concept of index investing. Index investing has been built on a logical shortcoming, whether supported by evidence or not. We think it is important that the investment community know of this. Read (pdf): The “Luck” and “Randomness” of Index Funds (2018), Brian Nelson, CFA See video documentation: /FALLACY_of_Index_Funds To … Read more

Average Check Increases Driving Results for Cracker Barrel

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Image Source: Mike Mozart Dividend Growth Newsletter portfolio holding Cracker Barrel drove average check increases to combat weak traffic that continues to plague the restaurant space. By Kris Rosemann Cracker Barrel Old Country Store (CBRL) reported its eleventh consecutive quarter of positive comparable restaurant sales growth in the second quarter of its fiscal 2017 on February 21. We continue to be fans of its dividend growth profile–its Dividend Cushion ratio is a healthy 1.7–and shares are trading in the lower bound of our fair value range. The company’s unique concept is working wonders on its ability to raise prices and offset industry-wide traffic woes that have weighed on the majority of the US restaurant space. During the quarter, Cracker Barrel’s … Read more

Dividend Growth Newsletter: Evaluating Our 2016 Dividend Growth Picks

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“…the average return of our dividend growth picks has blown the return of the S&P 500 out of the water during the past two years, and in each of the past two years.” By Brian Nelson, CFA What say us of our dividend growth stock-selection skills? First, on a portfolio level, I am very proud to say that the Dividend Growth Newsletter portfolio has advanced in each of the past two years, while the SPDR S&P Dividend ETF (SDY) has been significantly more volatile, declining during 2015, and bouncing back during 2016. For supposedly steady-eddy dividend growth indices, they tend to be quite volatile relative to the Valuentum Dividend Growth Newsletter portfolio, one of the main reasons why I don’t … Read more

Tough Month – My Goodness

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By Brian Nelson, CFA The market rallied hard this month and seemed to leave a lot of the Dividend Growth Newsletter portfolio ideas behind. I’m not going to sugarcoat the results: The Dividend Growth Newsletter portfolio disappointed this month, and for that I’m sorry.  A lot of it may be “explainable” in light of what happened on Election Day 2016, however. I think a lot of investors have shifted capital from the stronger dividend payers to the more-speculative ones in hopes that a new, pro-business Trump administration will be their saving grace. We hope so, but Trump cannot be President forever, and dividend growth investors should consider a long-term perspective, in my opinion, especially when it comes to compounding payouts … Read more

Cracker Barrel Continues Positive Comparable Store Restaurant Sales Streak

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Image Source: Neil Thompson By Kris Rosemann Even prior to adding Cracker Barrel (CBRL) to the Dividend Growth Newsletter portfolio, “Alerts: A Long-Time Favorite from the Bullpen and An Interest Rate Risk Hedge,” we had been keen observers of the stock’s potential as an income idea, “Free Cash Flow Feeds Cracker Barrel’s Dividend Growth.” We continue to believe the restaurant has been proficient in setting itself apart from the remainder of the dine-in restaurant space, and not just in the sense of its differentiated concept, but the proof is in the numbers, too. For example, the company’s operating margin expanded to 9.6% in fiscal 2016 from 6.9% in fiscal 2011, while sales growth at Cracker Barrel has expanded at a … Read more

Examining Same-Store Sales in the Restaurant Industry

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Key Takeaways September 2016 marked the fourth consecutive month of same-store restaurant sales declines, but the pressure is not indiscriminant. Millennials account for nearly a quarter of restaurant spending and are anticipated to account for 40% of restaurant purchases by 2020. Their preferences are becoming important considerations for the strategic planning of restaurants. Fast food restaurants with exposure to the coffee and breakfast segments appear to be faring better than those with limited or no exposure to the segments. Experiential dining is becoming increasingly important in the full-service arena as the gap between grocery prices and food away from home prices has widened of late.     By Kris Rosemann The broader restaurant sector (BITE) has been under pressure as of … Read more

Retail Weakness: Blame the Election?

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Image Source: DonkeyHotey By Kris Rosemann The 2016 election cycle has been one characterized by unprecedented amounts of criticism and accusations, of both the personal and political variety, and it may be true that the perceived political environment from the view of the general public has not been in such a state of uncertainty for some time. Let’s not get into the details of who called whom what in last night’s Presidential debate, but some parents were reportedly not allowing their children to watch the debate out of fear that their values or outlook on democracy could be skewed. But could the uncertainty surrounding the election actually be enough to impact consumer activity at retail outlets and restaurants? Some are … Read more