Below is a brief note from CEO Keith McCullough on why we're adding Cheesecake Factory (CAKE) to the long side of Investing Ideas today:
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Spring and summer Friday's are fun because you get some price disconnects with some big decision makers on the golf course. Today we're registering an immediate-term TRADE oversold signal within a Bullish @Hedgeye TREND stock, Cheesecake Factory (CAKE). Howard Penney's most recent industry update is as follows: "Knapp-Track is reporting April estimated comparable restaurant sales of +1.9% and comparable guest counts of -0.9%. You have to go back to February 2016 to see comparable guest counts decline less than 1%, and back to June of 2015 to see comparable restaurant sales greater than 1.0%. Knapp noted in his report that Texas comparable restaurant sales are estimated to be 3.2%, 1.3 percentage points above the U.S. average, stronger oil markets are surely to thank for the strength. California, another big market for many restaurant companies, outperformed the U.S. average with comparable sales of 2.6%, 0.7 percentage points above the U.S. average." Long CAKE is one of his Top 3 casual dining ideas on the long side and it’s on sale today, KM |
