The Cheesecake Factory Inc

CAKE: XNAS (USA)

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Food Cost Inflation Detrimental Factor in Cheesecake Factory's 1Q

Apr 21, 2011

Cheesecake Factory CAKE posted modest first-quarter results that were in line with our 2011 projections. We are not surprised by the firm's continued ability to improve guest traffic, and we're encouraged that the firm was able to increase its average ticket. However, food cost inflation, which management projects to be 3%-3.5% in 2011, has already taken a bite out of earnings and may continue to do so over the coming months. We are maintaining our $27 fair value estimate.

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The Cheesecake Factory Inc

Food Cost Inflation Detrimental Factor in Cheesecake Factory's 1Q

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