An extra restaurant stock: Cheesecake Factory (CAKE)

Posted Jun 20th 2009 1:00PM by Jamie Dlugosch
Filed under: Cheesecake Factory (CAKE), Stocks to Buy

Restaurant stock #2: Cheesecake Factory (CAKE)

Can you believe Cheesecake Factory (NASDAQ: CAKE) traded below $5 last November?

I can. Its model of big meals and big cheesecake appeared vulnerable to the deep recession. Would consumers cut out the fat in their dining budget?

Apparently not, as the stock is up more than 3 times since hitting the bottom.

Now trading above $17 per share, CAKE is poised to return to previous highs of $40 per share. There is strong growth here, and an economic recovery enhances that growth.

I rate CAKE an A or Strong Buy.

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Tags: CAKE, Cheesecake Factory, Louis Navellier, restaurant stocks, stocks to buy, top stocks

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Reader Comments (Page 1 of 1)

6-20-2009 @ 3:16PM

Teri Davis said...

Their markup on the cheesecake slices is enormous--for $10 you can buy a 4 pound cheesecake factory cheesecake at Costco--which is almost cheaper than you can BAKE one at home--but it's still one of my favorite places and their cuisine is tasty, original and reasonably priced considering the HUGE portions.

6-20-2009 @ 4:02PM

Monte said...

((CAKE is poised to return to previous highs of $40 per share.))

CAKE has a book value of 7.75 -- it did reach $39 in Jan/06 where it was followed by a huge collapse of nearly 50% by June of that same year.

CAKE lived most of its 'bubble period' in the $20's.

How can you reconcile your statement above with these facts?