Cracker Story

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CBRL -- USA Stock  

USD 141.06  2.03  1.42%

It appears without question that Cracker Barrel may not recover as fast as we have hopped for as its price went down 0.5% today. The entity's current daily volatility is 2.77 percent, with a beta of 0.18 and an alpha of 0.22 over DOW. While many traders are getting carried away by overanalyzing market volatility, it is reasonable to summarize Cracker Barrel Old based on how it reacts to the new economic swings. I will address the reasons why this entity does not get much respect from stakeholders under the current market uncertainty.
Published over three months ago
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Is Cracker Barrel (NASDAQ:CBRL) way too risky for millennials?
Cracker Barrel Old currently holds roughly 363.33 M in cash with 197.44 M of positive cash flow from operations. This results in cash-per-share (CPS) ratio of 15.33. The company currently holds 1.47 B in liabilities with Debt to Equity (D/E) ratio of 3.74, implying Cracker Barrel greatly relies on financing operations through barrowing. Cracker Barrel Old has a current ratio of 1.55, which is within standard range for the sector.
Investing in Cracker Barrel, just like investing in any other equity instrument, is characterized by a strong risk-return correlation. High risks mean high returns and low risk means lower expected returns. Risk management is the act of identifying and assessing the potential risk and developing strategies to minimize these risks and earn maximum possible profits while holding Cracker Barrel along with other instruments in the same portfolio. Using conventional technical analysis and fundamental analysis to select individual securities into a portfolio complements risk management and adds value to overall investors' investing strategies.
Sophisticated investors, who have witnessed many market ups and downs, frequently view the market will even out over time. This tendency of Cracker Barrel's stock price to converge to an average value over time is called mean reversion. However, historically, high market prices usually discourage investors that believe in mean reversion to invest, while low prices are viewed as an opportunity to buy. Please use the tools below to analyze the current value of Cracker Barrel in the context of predictive analytics.
Please note, it is not enough to conduct a financial or market analysis of a single entity such as Cracker Barrel. Your research has to be compared to or analyzed against Cracker Barrel's peers to derive any actionable benefits. When done correctly, Cracker Barrel's competitive analysis will give you plenty of quantitative and qualitative data to validate your investment decisions or develop an entirely new strategy towards taking a position in Cracker Barrel Old.

How important is Cracker Barrel's Liquidity

Cracker Barrel financial leverage refers to using borrowed capital as a funding source to finance Cracker Barrel Old ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Cracker Barrel financial leverage is typically calculated by taking the company's all interest-bearing debt and dividing it by total capital. So the higher the debt-to-capital ratio (i.e., financial leverage), the riskier the company. Please check the breakdown between Cracker Barrel's total debt and its cash.

How Cracker utilizes its cash?

To perform a cash flow analysis of Cracker Barrel, investors first need to understand how to read the cash flow statement. A cash flow statement shows the amount of cash Cracker Barrel is receiving and how much cash it distributes out in a given period. The Cracker Barrel cash flow statement breaks down these inflows and outflows into different buckets, including operating activities, investing activities, and financing activities. Cracker Barrel Net Cash Flow from Operations is relatively stable at the moment as compared to the past year. The company's current value of Net Cash Flow from Operations is estimated at 241.5 Million

Cracker Barrel Correlation with Peers

Investors in Cracker can reduce exposure to individual asset risk by holding a diversified portfolio of assets in addition to a long position in Cracker Barrel Old. Diversification will allow for the same portfolio return with reduced risk. The correlation table of Cracker Barrel and its peers is a two-dimensional matrix that shows the correlation coefficient between pairs of securities Cracker is related in some way. The cells in the table are color-coded to highlight significantly positive and negative relationships. Each cell shows the correlation between one pair of equities and can be used to run pair trading strategies or create efficient portfolios with your current brokerage. Please check volatility of Cracker for more details

A Deeper Perspective On Cracker Barrel

Cracker Barrel appears to be very steady, given 1 month investment horizon. Cracker Barrel Old secures Sharpe Ratio (or Efficiency) of 0.1, which signifies that the company had 0.1% of return per unit of standard deviation over the last month. Our philosophy in foreseeing the volatility of a stock is to use all available market data together with stock specific technical indicators that cannot be diversified away. We have found twenty-eight technical indicators for Cracker Barrel Old, which you can use to evaluate future volatility of the firm. Please makes use of Cracker Barrel Old risk adjusted performance of 0.1026, and Mean Deviation of 2.07 to double-check if our risk estimates are consistent with your expectations.
Click cells to compare fundamentals   Check Volatility   Backtest Portfolio

Cracker Barrel is projected to stay under $139 in October

Treynor ratio is down to 1.3. It may denote a possible volatility pull down. Cracker Barrel Old currently demonstrates below-verage downside deviation. It has Information Ratio of 0.05 and Jensen Alpha of 0.22. However, we do advice investors to further question Cracker Barrel Old expected returns to ensure all indicators are consistent with the current outlook about its relatively low value at risk.

The Bottom Line

While many other companies in the restaurants industry are either recovering or due for a correction, Cracker may not be as strong as the others in terms of longer-term growth potentials. With an impartial outlook on the current market volatility, it may be better to hold off any inventment activity and neither take in nor short any shares of Cracker Barrel at this time. The Cracker Barrel Old risk-reward trade off is not appealing enough to do any trading. Please use our equity advice module to run different scenarios to ensure your current risk level and investment horizon are fully reflective of your current investing preferences in regards to Cracker Barrel.

About Contributor

This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Achuva Shats do not own shares of Cracker Barrel Old. Please refer to our Terms of Use for any information regarding our disclosure principles.

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