Cheesecake Factory (CAKE) AI Stock Analysis

• Market Cap: $2.40B
• Dividend Yield: 2.14%
• Average Volume (3M): 1.44M
• Price to Earnings (P/E): 14.6
• Beta (1Y): 0.88
• Revenue Growth: 4.90%
• EPS Growth: 27.14%
• Country: US
• Employees: 47,900
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Restaurants
• EPS (TTM): 0.68
• Shares Outstanding: 49,841,690
• 10 Day Avg. Volume: 2,089,124
• 30 Day Avg. Volume: 1,442,686
• PEG Ratio: 0.26
• Price to Book (P/B): 5.11
• Price to Sales (P/S): 0.63
• P/FCF Ratio: 21.00
• Enterprise Value/Market Cap: 1.92
• Enterprise Value/Revenue: 1.26
• Enterprise Value/Gross Profit: 2.06
• Enterprise Value/Ebitda: 16.27
• 1Y Price Target: $58.83
• Price Target Upside: 25.33% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 13
• EPS Forecast (FY): 3.78
• Revenue Forecast (FY): $3.74B

• Rating: 68 Neutral
• Price Target: $67.00 ▲(42.74% Upside)

The Cheesecake Factory's overall stock score is driven by strong earnings performance and positive earnings call sentiment, highlighting record revenues and improved profit margins. However, financial performance is tempered by high leverage, and technical indicators suggest caution with short-term bearish trends. Valuation is fair, with a reasonable P/E ratio and modest dividend yield.

Positive Factors

Revenue Growth

Record-breaking revenue growth indicates strong market demand and effective business strategies, supporting long-term financial health.

Profit Margin Improvement

Improved profit margins reflect operational efficiency and cost management, enhancing the company's ability to sustain profitability.

New Restaurant Openings

Expansion through new restaurant openings supports revenue diversification and strengthens market presence, driving future growth.

Negative Factors

High Leverage

High leverage can strain financial flexibility and increase risk, potentially impacting long-term stability and growth opportunities.

Traffic Decline

Declining traffic can hinder sales growth and signal challenges in customer retention, affecting future revenue potential.

Increase in Operating Expenses

Rising operating expenses can pressure profit margins and limit the company's ability to invest in growth initiatives.

Cheesecake Factory Business Overview & Revenue Model

Company Description

The Cheesecake Factory Incorporated (CAKE) is a renowned American restaurant chain and manufacturer of cheesecakes, recognized for its extensive menu featuring over 250 dishes, including appetizers, salads, pizzas, pasta, seafood, and more. Established in 1978, the company operates more than 200 locations across the United States and internationally, providing a casual dining experience with a focus on quality ingredients and exceptional service. In addition to its signature cheesecakes, the company also offers a variety of desserts and beverages, catering to a broad customer base that values diverse dining options.

How the Company Makes Money

The Cheesecake Factory primarily generates revenue through its restaurant operations, which include dine-in, takeout, and delivery services. The company's revenue model is heavily reliant on food and beverage sales in its restaurants, complemented by the sale of its branded cheesecakes through retail partnerships and its own bakery operations. Key revenue streams include dining services, dessert sales, and wholesale distribution of its cheesecakes to grocery stores and other food service entities. Significant partnerships with grocery chains and the growth of its takeout and delivery services have further contributed to its earnings, alongside expanding its brand presence in the food retail market.

Cheesecake Factory Financial Statement Overview

Summary

The Cheesecake Factory demonstrates solid financial performance with strong profitability and cash flow generation. However, high leverage remains a concern, potentially impacting long-term financial stability. Continued focus on managing debt levels and maintaining profitability will be crucial for sustaining growth.

Income Statement

The Cheesecake Factory shows a strong gross profit margin of 60.88% TTM, indicating efficient cost management. The net profit margin is stable at 4.33% TTM, with consistent revenue growth over the past years, albeit at a slower rate recently. EBIT and EBITDA margins are healthy, reflecting operational efficiency. However, the slight decline in margins compared to previous years suggests some pressure on profitability.

Balance Sheet

The balance sheet reveals a high debt-to-equity ratio of 5.24 TTM, indicating significant leverage, which could pose financial risk. Return on equity is strong at 40.22% TTM, showcasing effective use of equity to generate profits. However, the equity ratio is low, suggesting reliance on debt financing, which may impact financial stability.

Cash Flow

Cash flow analysis shows a positive trend with a 15.15% growth in free cash flow TTM, indicating improved cash generation. The operating cash flow to net income ratio of 0.42 TTM suggests adequate cash flow relative to earnings. However, the free cash flow to net income ratio is moderate, pointing to potential constraints in cash availability for expansion or debt reduction.

Breakdown	TTM	Dec 2024	Dec 2019	Dec 2018	Dec 2017	Dec 2016
Income Statement
Total Revenue	3.67B	3.58B	2.48B	2.33B	2.26B	2.28B
Gross Profit	2.23B	2.78B	1.02B	965.32M	963.52M	989.09M
EBITDA	283.11M	282.90M	230.36M	210.09M	245.00M	285.38M
Net Income	158.90M	156.78M	127.29M	99.03M	157.39M	139.49M
Balance Sheet
Total Assets	3.15B	3.04B	2.84B	1.31B	1.33B	1.29B
Cash, Cash Equivalents and Short-Term Investments	148.76M	84.18M	58.42M	26.58M	6.01M	53.84M
Total Debt	2.10B	1.91B	1.61B	10.00M	10.00M	100.58M
Total Liabilities	2.75B	2.60B	2.27B	743.07M	719.53M	690.11M
Stockholders Equity	400.95M	443.45M	571.74M	571.06M	613.53M	603.21M
Cash Flow
Free Cash Flow	131.00M	107.96M	142.90M	185.39M	116.36M	185.06M
Operating Cash Flow	309.64M	268.32M	218.76M	291.31M	238.80M	302.52M
Investing Cash Flow	-179.19M	-161.10M	-363.06M	-130.39M	-140.43M	-159.46M
Financing Cash Flow	-22.36M	-78.79M	176.02M	-140.29M	-146.09M	-133.07M

Cheesecake Factory Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 46.94
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CAKE, the sentiment is Negative. The current price of 46.94 is below the 20-day moving average (MA) of 52.57, below the 50-day MA of 55.01, and below the 200-day MA of 55.08, indicating a bearish trend. The MACD of -2.10 indicates Positive momentum. The RSI at 27.64 is Positive, neither overbought nor oversold. The STOCH value of 4.82 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for CAKE.

Cheesecake Factory Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ARCO	71 Outperform	$1.50B	11.53	24.80%	3.37%	0.09%	-23.74%
CAKE	68 Neutral	$2.40B	14.64	39.14%	2.14%	4.90%	27.14%
EAT	67 Neutral	$4.65B	10.73	249.07%	―	23.18%	138.17%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
SHAK	60 Neutral	$4.09B	90.28	8.83%	―	13.49%	402.23%
CBRL	59 Neutral	$721.95M	15.70	10.29%	3.22%	0.37%	12.99%
PZZA	55 Neutral	$1.42B	19.16	―	3.62%	-1.46%	8.10%

Cheesecake Factory Corporate Events

Cheesecake Factory Reports Q2 2025 Financial Results

On July 29, 2025, The Cheesecake Factory reported its financial results for the second quarter of fiscal 2025, revealing total revenues of $955.8 million, a rise from $904.0 million in the same quarter of fiscal 2024. The company achieved a net income of $54.8 million, with comparable restaurant sales increasing by 1.2% year-over-year. The company opened eight new restaurants during the quarter and plans to open up to 25 new locations by the end of the year. The Board declared a quarterly dividend of $0.27 per share, to be paid on August 26, 2025.