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Recent Articles
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Latest Report Updates
Dec 29, 2023
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Check out the latest report updates on the website.
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Dividend Increases/Decreases for the Week of December 29
Dec 29, 2023
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Let's take a look at firms raising/lowering their dividends this week.
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6%+ Dividend Yielder Cracker Barrel Needs to Raise Menu Prices More Aggressively
Dec 28, 2023
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Image: Cracker Barrel remains focused on returning cash to shareholders.
We think performance at Cracker Barrel is fixable, but it has to be menu price-driven as commodity price and hourly wage inflation continues to eat into operating income, and traffic remains troubled even with increased spend on marketing. Notwithstanding its long-term unit growth opportunities at its Cracker Barrel and Maple Street stores, Cracker Barrel’s unique concepts continue to resonate with consumers, but the firm is being left behind in a world where other restaurants are sacrificing price-conscious consumers for those less concerned about price increases. Its ~6.3% dividend yield at the time of this writing speaks of heightened risk, as does its 0.5 Dividend Cushion ratio, but if Cracker Barrel can turn things around by ratcheting up its pricing initiatives more aggressively in fiscal 2025 and beyond, the stock could end up being one of the most attractive income ideas on the market today. For now, however, we’re watching and waiting for a strategic shift.
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Dividend Aristocrat Enterprise Products Partners Boasts 7%+ Yield, Investment-Grade Marks
Dec 27, 2023
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Image: Enterprise Products Partners continues to raise its distribution year after year. Source: Enterprise Products Partners.
Though, in general, we’re not too excited by the midstream pipeline space given their capital-intensive nature and hefty net debt positions, Enterprise Products Partners has a lot of things going for it. The company boasts investment-grade credit ratings (A-/A-/A3), has strong and consistent returns on invested capital, and has put up 25 years of consecutive distribution increases. In addition to growing its payout in each year for more than two decades, management has done a great job reducing its leverage ratio (net debt adjusted for equity credit in its junior subordinated notes divided by adjusted EBITDA). For the trailing twelve months ended in the third quarter, its leverage ratio has fallen to 3.0x from 4.1x in 2017. All told, we think Enterprise Products Partners’ growth initiatives will help to solve revenue pressures, and we expect the company to continue to drive distribution growth in the coming years as it keeps its leverage in check.
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