It has been a rough time, lately, to be restaurant chain Cracker Barrel (CBRL). Recently, it has taken on a variety of changes in a bid to draw more customers. But there are concerns that the changes may be doing more harm than good, as the customers that are currently there are starting to feel alienated by all the changes. This left Cracker Barrel in a bad position, and down nearly 1.5% in Monday afternoon’s trading.
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Sharon Triana, a long-time Cracker Barrel customer, recently told The Wall Street Journal: “I’m secretly wishing that maybe the changes don’t come to our restaurant.” One of the biggest changes was to décor; Cracker Barrel restaurants are known for a wide range of ephemera—from old bottles to old tools to old advertising signs—on their walls. But some restaurants have pared this back, hoping to invite diners to eat in a restaurant that looks more like a restaurant and less like an explosion in a thrift shop.
And while some certainly find the changes a relief—fresh paint, reduced clutter and the like make for a more enjoyable experience—others prefer the restaurant the way it used to be. In fact, one of the biggest questions for those who find their location being renovated is if they can purchase the antiques being taken down from the Cracker Barrel walls
Flapjacks and a Beer Back
That was not the only change at Cracker Barrel, as not long ago, it revealed that it would be bringing out alcohol to some of its locations. This would not be the first time; Cracker Barrel started adding some booze to the menu back in June 2020, hoping to offset pandemic losses. It discovered people did indeed want an adult beverage with their dinner, in some cases, and thus kept the program in place, expanding it to other locations.
But there are limits; Cracker Barrel locations have only wine, beer, and “premade cocktails” on the menu. There is no hard liquor for fresh mixes, and any alcohol can only be ordered with food. In some cases, Cracker Barrel can even offer pairings, suggesting a mimosa with an Old Timer’s Breakfast.
Is Cracker Barrel Stock a Buy?
Turning to Wall Street, analysts have a Hold consensus rating on CBRL stock based on one Buy, three Holds and two Sell recommendations assigned in the past three months, as indicated by the graphic below. After a 48.28% rally in its share price over the past year, the average CBRL price target of $54 per share implies 10.7% downside risk.
