On Thursday, The Cheesecake Factory Incorporated [NASDAQ:CAKE] has a current price of $31.75, coming out to a daily percentage change of 2.02% with a 52-week range of $14.52 – $45.24.
Other data for the company is as follows:
- Stochastic %K of 89.25
- Weighted Alpha of -2.1
Analysts have the price target for The Cheesecake Factory Incorporated [CAKE] at 25.71. Daily swings are between $29.58 and $31.25.
Wait and see
Holding a Market Cap of $1.38 billion, The Cheesecake Factory Incorporated has seen a trading range over the last year of $14.52-$45.24.
For the last five days, CAKE is up from its last closing price. The average shares trading hands each day is 1.71M, with average 10-day volume coming in at 1.29 million.
Using a Force Index Indicator is a good way to look at how strong actual buying and selling pressure is for CAKE. When we apply the Elder Force Index to The Cheesecake Factory Incorporated, we are seeing an Elder Force Indicator number of 365752.17.
Recent Performance
The recent performance of the stock is another area that can tell traders how to proceed. CAKE is presenting an interesting case. This can be seen in the Forward P/E ratio, which currently stands at 25.72. Moreover, the company’s enterprise value has gone from $2.68B to $2.33B quarter-over-quarter. Obviously, the company is heading in the wrong direction, but there are still opportunities for growth in the sector.
In the last quarter, CAKE made a profit of -20.77 million. The Cheesecake Factory Incorporated also saw quarter revenue growth year over year of 6.45%. In addition, the company has operating cash flow of $99.31 million.
Technical Analysis
Looking at popular technical indicators, the company’s 5-day moving average is 30.27 compared to the 50-day moving average of 29.08. So, we are clearly seeing an upward trajectory here.
The Relative Strength Index or RSI is an indicator ranging between 0 and 100 that traders use to determine if a stock is “overbought” or “oversold.” A strong uptrend tending to reach into the “overbought” status is above 70, while a downward trend will stay around the 30 mark. CAKE currently holds a 9-day RSI of 69.07%, while 100-day RSI stands at 51.69%.
Another indicator we believe is worth keeping tabs on is the Moving Average Convergence Divergence or MACD. Similar to the concept of the Force Index — on the basis of price momentum — the MACD gives traders a tool to measure the turning point of a stock even during rapid fluctuations in price. Buy and sell signals are determined by a stock’s relation to the zero line, so if a stock is above a zero line for many weeks it might be a “buy.” On the other hand, if a stock is below the zero line consistently, it might be one to stay away from. Also, if the MACD line reaches a peak and dips, its momentum may be waning. CAKE’s 9-day MACD is 1.53 and the company’s 100-day MACD stands at 5.24.
Inside Moves
Another area that is important to analyze is insider moves and majority shareholders. While this is not always an error-free way to tell what the future holds for a stock, you can maybe gather important information from reading the tea leaves about who is buying and selling.
The major holders for this stock are 7.06% by insiders and 101.82% by institutions. Regarding institutional holdings, Blackrock Inc. owns 15.77%, while the second top holder, Vanguard Group, Inc. (The), currently owns 9.43%.
Over the last six months, insiders have bought 1,300 with the most recent transaction from Ames Edie A, Director, with a purchase at price 30.45 per share.
Conclusion
Overall, the recommended rating for CAKE is Hold. Currently, the company has 21 analysts watching the stock, and the average quarterly earnings estimate is -0.43. Quarterly revenue estimates are averaging 485.8M with the high estimate reaching 533M and the low at 437.7M.
To review, the current 1-year target estimate is sitting at 25.71, while the current price 31.75. Based on this, we expect some pullback on the stock over time given our above analysis.
