Breaking Down Cracker Barrel Old Country Store, Inc. (CBRL) Financial Health: Key Insights for Investors

You're looking at Cracker Barrel Old Country Store, Inc. (CBRL) and wondering if the comfort food staple is a solid investment or a value trap, and honestly, the numbers show a complex picture right now. On one hand, the company closed out its fiscal 2025 with total revenue of $3.48 billion and delivered 9% Adjusted EBITDA growth, plus restaurant sales are still chugging along, posting a 5.4% comparable store increase in the fourth quarter. But here's the quick math on the risk: that strong performance is being overshadowed by a controversial rebranding effort that has coincided with a traffic decline of roughly 8% since August 2025, and activist investor Biglari Capital is now citing a loss of over $1 billion in market value to push for a leadership change. We need to cut through the noise to see if the new $100 million share repurchase program and the stable $0.25 quarterly dividend are enough to stabilize the stock, especially when the full-year GAAP net income was only $46.4 million.

Revenue Analysis

If you're looking at Cracker Barrel Old Country Store, Inc. (CBRL), the direct takeaway is that its revenue engine is running, but it's heavily reliant on the kitchen, not the gift shop. For the full fiscal year 2025, which ended August 1, 2025, total revenue was $3.48 billion [cite: 5, 10 in previous search].

The year-over-year revenue growth looks modest at first glance, but you need to look closer. The reported increase was just 0.4%, but that figure is skewed by an extra week in the prior fiscal year. When you adjust for that 53rd-week benefit, the true comparable growth rate was actually 2.2%. This is a slow, steady climb, but it shows the core business is still managing to grow top-line sales despite a tough consumer environment.

The company's revenue streams are cleanly divided into two segments: the restaurant and the retail store, which is the Old Country Store gift shop. Honestly, this is a restaurant company that happens to have a retail component, not the other way around. Here's the quick math based on management's stated business mix:

• Restaurant Sales (Food & Beverage): Approximately 80% of total revenue.
• Retail Sales (Gifts, Apparel, Merchandise): Approximately 20% of total revenue.

This means that of the $3.48 billion in total revenue, roughly $2.784 billion came from food and beverage, with the remaining $696 million from retail. The restaurant side is defintely the primary driver you need to focus on.

What this revenue breakdown hides is the divergence in performance between the two segments. The restaurant segment is carrying the weight of the growth plan. For example, in the fourth quarter of fiscal 2025, comparable store restaurant sales increased by a solid 5.4%. This reflects the success of strategic pricing increases and a favorable menu mix, meaning people are choosing higher-priced items.

On the other hand, the retail side is struggling. Comparable store retail sales actually decreased by 0.8% in the fourth quarter of fiscal 2025. Retail items are discretionary, and in an uncertain economy, consumers pull back on knick-knacks and gifts first. This trend highlights a clear risk: the retail segment is a drag on overall comparable sales.

To be fair, the company is aware of this, and management has been focused on back-of-house optimization and other initiatives to enhance the guest experience, which is why the restaurant sales are performing well. If you want to dive deeper into who is investing in this mixed-bag model, you should check out Exploring Cracker Barrel Old Country Store, Inc. (CBRL) Investor Profile: Who's Buying and Why?

Profitability Metrics

You need to know if Cracker Barrel Old Country Store, Inc. (CBRL) is turning its strong brand recognition into actual profit, especially in a high-inflation environment. The direct takeaway is that while the company's operational efficiency is showing improvement, its net profitability remains severely constrained, lagging significantly behind the casual dining industry average.

For the full fiscal year 2025, which ended in August, Cracker Barrel Old Country Store, Inc. (CBRL) reported total revenue of approximately $3.48 billion. The challenge isn't revenue; it's translating that revenue through the cost structure. Here's the quick math on the key margins-the percentages that tell the real story of financial health:

• Gross Profit Margin: The company posted a Gross Profit Margin of approximately 33.0%. This is what's left after covering the Cost of Goods Sold (COGS)-the food, retail merchandise, and direct labor to prepare it.
• Adjusted EBITDA Margin: A better measure of core operational efficiency (before interest, taxes, depreciation, and amortization), this margin was roughly 6.5% (calculated from the reported Adjusted EBITDA of $224.3 million).
• Net Profit Margin: The final take-home percentage was a thin 1.3%, based on GAAP net income of just $46.4 million. That's a very small cushion.

Operational Efficiency and Margin Trends

The trend in profitability shows a company fighting hard to regain ground. While the 1.3% Net Profit Margin for FY 2025 represents a recovery from prior-year lows, it still highlights a fundamental pressure point: high operating costs. The Gross Margin of 33.0% is the first signal. This is defintely where the company's dual model-restaurant and retail-creates complexity, as the retail side typically carries a lower gross margin than the restaurant side, pulling the blended average down.

To be fair, the management's focus on operational improvements is visible in the Adjusted EBITDA growth, which was up 9% in fiscal 2025. But still, when you look at the full cost stack, the gains are getting eaten up by Selling, General, and Administrative (SG&A) expenses and other overhead. We need to see that 6.5% Adjusted EBITDA margin convert to a higher net margin to feel comfortable.

Here's how Cracker Barrel Old Country Store, Inc. (CBRL) stacks up against its peers in the full-service restaurant (FSR) space, based on 2025 industry data:

The gap is stark. The industry median Gross Margin for restaurants sits around 46.22%, meaning Cracker Barrel Old Country Store, Inc. (CBRL)'s 33.0% is ranked worse than over 70% of companies in the sector. This is a structural issue, not a cyclical one, tied to the labor-intensive nature of their full-service model and the cost of maintaining the retail segment.

What this estimate hides is the potential for their strategic transformation plan to drive future margin expansion. If they can continue to outperform the Black Box Intelligence Casual Dining Index in comparable store sales, as they did in Q1 2025, that volume leverage will eventually help reduce the percentage weight of fixed costs. For a deeper look at the market sentiment around the company's turnaround efforts, you should check out Exploring Cracker Barrel Old Country Store, Inc. (CBRL) Investor Profile: Who's Buying and Why?

Your action item here is clear: Monitor the next two quarters for a sustained increase in the Gross Margin, specifically looking for it to move closer to the 34% range, which would signal real traction in cost management or menu pricing power.

Debt vs. Equity Structure

You need to know how Cracker Barrel Old Country Store, Inc. (CBRL) is funding its operations, because the balance between debt and equity tells you a lot about risk and financial flexibility. The short answer is that the company relies heavily on debt financing, a common but risky strategy in the casual dining sector, but they have recently restructured their debt to manage near-term maturities.

As of the end of fiscal year 2025 (August 1, 2025), Cracker Barrel Old Country Store, Inc. carried a total debt load of $484.6 million. This is a significant figure, and it's split between short-term and long-term obligations. This high leverage is typical for a capital-intensive business like restaurants, but it demands careful attention to interest coverage and cash flow.

• Short-Term Debt: $149.2 million, primarily from the remaining 0.625% Convertible Senior Notes due in 2026.
• Long-Term Debt: $335.4 million, tied to the newly issued 1.75% Convertible Senior Notes due in 2030.

The Debt-to-Equity (D/E) ratio is where the picture gets interesting. Cracker Barrel Old Country Store, Inc.'s D/E ratio was around 2.56 for the fiscal year ending in 2025. Here's the quick math: for every dollar of shareholder equity, the company has taken on $2.56 in debt. This is high, especially when you compare it to the restaurant industry's median D/E ratio, which often sits closer to 2.01. A ratio above 2.5 is defintely a red flag, suggesting a high level of financial leverage (the use of borrowed money to finance assets). Still, the company's consolidated total leverage ratio was a more manageable 2.0x at the end of fiscal 2025, which is a key metric for lenders.

The company made a clear move in 2025 to manage its debt maturity profile. In May 2025, they entered a new credit agreement, reducing their revolving credit facility from $700 million to $550 million and introducing a $250 million delayed draw term loan. Then, in June 2025, they issued $300.0 million in new 1.75% convertible senior notes due 2030. They immediately used approximately $145.9 million of the proceeds to repurchase $150.0 million of the older, near-term notes due in 2026. This is a classic 'term out' strategy: swapping short-term debt for longer-term debt to push out the repayment cliff and reduce refinancing risk.

The balance between debt and equity funding is currently tilted heavily toward debt. The issuance of convertible notes in 2025 is a hybrid approach. It's debt now, but it gives noteholders the option to convert to common stock if the stock price hits a certain threshold (the conversion price of approximately $72.23 per share). This means future growth could lead to shareholder dilution, but it offers a lower initial interest rate (1.75%) than traditional bonds. It's a calculated risk to fund growth while keeping upfront cash costs low.

For more on the operational risks tied to this debt structure, check out Breaking Down Cracker Barrel Old Country Store, Inc. (CBRL) Financial Health: Key Insights for Investors.

Liquidity and Solvency

You need to know if Cracker Barrel Old Country Store, Inc. (CBRL) can cover its near-term bills, and honestly, the liquidity picture is tight. The short answer is that the company relies heavily on its operating cash flow to manage a significant working capital deficit, which is common in the restaurant industry but still a risk you should monitor.

Looking at the end of fiscal year 2025, Cracker Barrel's current ratio-a measure of current assets divided by current liabilities-stood at just 0.50. This means for every dollar of short-term debt due within a year, the company had only $0.50 in assets like cash, receivables, and inventory to cover it. The quick ratio (or acid-test ratio), which strips out inventory to show the ability to pay with the most liquid assets, was even lower at 0.21. That's defintely a red flag for traditional analysis.

Here's the quick math on working capital: Current Assets were approximately $313.11 million, while Current Liabilities totaled about $625.60 million. This results in a working capital deficit of over $312 million. The main components of those current liabilities are accounts payable and a sizable current portion of long-term debt, which was about $149.18 million in FY 2025. A negative working capital trend is typical for a high-volume retailer/restaurant because they collect cash immediately but pay suppliers later, but the sheer size of the deficit warrants attention.

• Current Ratio: 0.50 (Low liquidity)
• Quick Ratio: 0.21 (Very low liquid position)
• Working Capital: -$312.49 million (Significant deficit)

The saving grace for Cracker Barrel is its strong cash flow from operations. For the full fiscal year 2025, the company generated $218.90 million in operating cash flow. This is the money flowing in from the core business of selling meals and retail goods, and it's what truly funds their day-to-day operations despite the balance sheet's tight look. This operating cash flow increased from the prior year, showing the core business is still a cash generator.

The cash flow statement overview for 2025 shows a clear deployment of this cash:

The large negative investing cash flow of $156.70 million is primarily due to capital expenditures, which is money spent on property and equipment, a necessary expense for maintaining and growing restaurant locations. The negative financing cash flow of $34.59 million reflects payments for dividends and debt. The net result was an increase in cash and cash equivalents to $39.64 million by year-end, up significantly from the prior year. This is a solid trend, but it still means the company has to execute flawlessly on its operations to keep the cash machine running. For more on who is betting on this operational strength, check out Exploring Cracker Barrel Old Country Store, Inc. (CBRL) Investor Profile: Who's Buying and Why?

Valuation Analysis

You are looking at Cracker Barrel Old Country Store, Inc. (CBRL) right now and wondering: is this a deep-value play or a value trap? Based on the available metrics as of November 2025, the stock appears significantly undervalued relative to its historical averages, but the weak stock price trend and analyst sentiment suggest underlying operational risks are defintely weighing on the multiple.

The market is pricing in substantial risk, pushing the stock to a new 52-week low of around $27.42 in November 2025. Here's the quick math on why the stock looks cheap on paper, but why you need to dig into the fundamentals-like their Mission Statement, Vision, & Core Values of Cracker Barrel Old Country Store, Inc. (CBRL).-to see if the turnaround plan can bridge the gap.

The valuation multiples tell a story of investor skepticism. The current Price-to-Earnings (P/E) ratio is sitting at a mere 13.89 as of mid-November 2025, which is less than half of its 10-year historical average of 31.14. This discount signals that the market expects earnings to decline or remain flat, despite the company reporting an Adjusted EBITDA of $224.3 million for the full fiscal year 2025. The Enterprise Value-to-EBITDA (EV/EBITDA) ratio is also low, sitting at approximately 10.7x for the fiscal year ended August 1, 2025, which is lower than many of its casual dining peers.

To put the valuation in context, here are the key ratios you should be tracking:

Looking at the stock price trend, the picture is tough. Over the last 12 months, the stock has been in a clear downtrend, hitting a 52-week high of $71.93 and a low of $27.24. The stock's performance in 2025 alone shows a year-to-date decline of around -44.60%, which is a significant destruction of shareholder value. You need to ask if the current management team has the right strategy to reverse this. One clean one-liner: The stock is cheap for a reason.

The analyst community reflects this uncertainty, with a consensus rating of 'Reduce' or 'Hold.' The average 12-month price target is approximately $50.88, which implies a massive upside from the current price, but the ratings breakdown shows little conviction. Specifically, out of a recent count of 11 analysts, you see a mixed bag:

• Buy Ratings: 2
• Hold Ratings: 6
• Sell Ratings: 3

This 'Hold'-heavy consensus tells you that Wall Street is waiting for a clear signal that the company's turnaround efforts are actually working before committing capital. They are not chasing this falling knife.

Finally, let's look at the dividend. Cracker Barrel Old Country Store, Inc. (CBRL) offers an attractive, though reduced, dividend with an annualized payout of $1.00 per share, translating to a dividend yield of approximately 3.6%. The dividend payout ratio (DPR) is a comfortable 48.31%, suggesting the company is generating enough earnings to cover the payment without significant strain. This yield offers a floor for the stock price, but dividend growth has been negative in recent years, so don't expect a quick raise. Your next step should be to model a Discounted Cash Flow (DCF) valuation using a conservative earnings growth rate to see if the intrinsic value truly aligns with the consensus target of $50.88. Owner: Portfolio Manager: Run a 5-year DCF model by end of week.

Risk Factors

You're looking at Cracker Barrel Old Country Store, Inc. (CBRL) and seeing a company that delivered $3.48 billion in total revenue for fiscal year 2025, plus a 5.4% comparable store restaurant sales increase in the fourth quarter. Honestly, that's a solid restaurant performance. But, as a seasoned analyst, I've got to tell you that the real story-and the near-term risk-is in the traffic and the two-part business model.

The company is facing a clear, immediate headwind: customer traffic. Management itself is anticipating a Q1 2026 traffic decline of approximately 7% to 8%, which is a significant drop that will impact future earnings. This isn't just a macro issue; it's compounded by their recent strategic missteps, like the brand modernization attempt that was quickly reversed after guest backlash. They hit the brakes on remodels and switched back to the classic logo, which was the right call, but it shows the fragility of changing a deeply traditional brand.

Operational and external pressures are squeezing the margins, too. We're seeing a persistent issue with commodity inflation, particularly in key items like beef, pork, and eggs, which directly impacts their cost of goods sold. Plus, they're projecting hourly wage inflation to run between 3.0% and 4.0% in fiscal 2026, which will keep labor costs elevated. Here's a quick snapshot of the financial risks we saw in 2025:

• Retail Sales Drop: Comparable store retail sales fell 0.8% in Q4 2025, showing the retail segment is struggling.
• Tariff Headwinds: The company incurred $2.4 million in additional tariff expense in Q4 2025, a real-world example of external regulatory risk.
• Impairment Charges: A $16.2 million non-cash store impairment charge was recorded in Q4 2025 for low-performing Maple Street stores, signaling execution issues with the smaller-format concept.

The dual-revenue model-restaurant and retail-is both a strength and a weakness. When the retail side shrinks, as it did in Q4, it puts more pressure on the restaurant to carry the load. This is defintely a key area to watch, especially as you consider Exploring Cracker Barrel Old Country Store, Inc. (CBRL) Investor Profile: Who's Buying and Why?

On the financial front, the company does have a decent liquidity cushion of $555.6 million at the end of fiscal 2025, but they also carry a total debt of $484.6 million, which includes $149.2 million of 0.625% Convertible Senior Notes due 2026 and $335.4 million of 1.75% Convertible Senior Notes due 2030. While their consolidated total leverage ratio was a manageable 2.0x at year-end, servicing this debt is a constant drain on cash flow, limiting their flexibility to fight the traffic slump.

Management's mitigation plan is focused on the basics: accelerating food quality improvements, optimizing the back-of-house operations, and expanding their loyalty program, which already grew by 3 million people over the year to over 9 million members. They're investing in maintenance, with $105 million of the full-year $158.6 million in capital expenditures going to store upkeep. This is a back-to-basics approach, which is smart.

Here's the quick math on their core financial health for the full fiscal year 2025:

Still, the biggest near-term risk remains the customer. If they can't reverse the traffic decline quickly, the positive momentum in restaurant sales (driven by pricing) will fade, and that $224.3 million in Adjusted EBITDA will be much harder to maintain. Next step: Finance needs to model the impact of a sustained 7% traffic decline on Q1 cash flow by end of next week.

Growth Opportunities

You're looking at Cracker Barrel Old Country Store, Inc. (CBRL) right now, and the picture is complex: it's a turnaround story where the near-term forecast is tough, but the strategic foundation for long-term growth is being laid. The company finished fiscal year 2025 with total revenue of approximately $3.48 billion and adjusted EBITDA of $224.3 million, showing some momentum from its strategic plan, but the path ahead is bumpy. Honestly, the next 12 months are about internal investment and stabilizing traffic, not explosive growth.

Key Growth Drivers: Menu and Operational Efficiency

The core of Cracker Barrel's strategy is fixing the guest experience and the back-of-house operations. They launched their largest menu overhaul in years, adding craveable items like the Bee Sting Chicken Tenders to attract a broader, younger audience while keeping staple pricing affordable. This is a smart move to balance nostalgia with modernity.

Operational efficiency is where the real margin expansion (profitability) will come from. They rolled out Phase One of a back-of-house optimization system-wide during fiscal 2025. This move, which streamlines kitchen workflows, helped reduce hourly employee turnover by approximately 14 percentage points and is key to improving consistency and cutting food waste. Better operations mean better margins. That's the quick math.

• New menu items drive traffic.
• Streamlined kitchens cut labor costs.
• Loyalty program boosts spending.

Digital and Off-Premise Momentum

The Cracker Barrel Rewards program is defintely a bright spot, functioning as a critical growth engine for the off-premise business (takeout and delivery). By the end of fiscal 2025, the program reached a target of 8 million members and now drives over one-third of tracked sales. They are using AI-driven personalization to target promotions, which has yielded a mid-single-digit lift in average revenue per member. This data-driven approach is a significant shift for a heritage brand and shows they are serious about competing in the modern casual dining space.

You can see the long-term vision for the brand's heritage and evolution in their Mission Statement, Vision, & Core Values of Cracker Barrel Old Country Store, Inc. (CBRL).

Near-Term Financial Headwinds and Projections

Here's the part you need to watch closely: the company's guidance for fiscal year 2026, which replaces earlier, more optimistic long-term forecasts. Management is projecting a significant drop, primarily due to weaker traffic trends following some recent brand changes. This is a clear near-term risk.

The company reported adjusted earnings per diluted share of $3.16 for fiscal 2025. For fiscal 2026, the guidance is sobering:

What this estimate hides is the impact of shifting capital allocation. After initial plans to complete 25 to 30 store remodels in fiscal 2025, the company paused the costly, full-scale remodel program in late 2025 following customer backlash. Capital expenditures for FY 2025 were still high, in the $160 million to $180 million range, but future CapEx will focus more on maintenance and less on new store aesthetics, which is a pivot to conserve cash and address core operational issues first.

Competitive Advantages and Expansion

Cracker Barrel's true competitive edge lies in its unique dual-business model: a full-service restaurant paired with the Old Country Store retail component. This model, combined with its prime real estate locations, many near interstate exits, provides a durable, albeit currently underperforming, asset base. The brand is an American icon; that's hard to replicate.

Market expansion is slow but steady, focusing on the higher-growth Maple Street Biscuit Company acquisition. In fiscal 2025, the company planned to open just Two new Cracker Barrel stores but 3 to 4 new Maple Street Biscuit Company units. This disciplined, small-scale expansion focuses capital on the most promising growth vehicles. The brand equity is the moat, but it needs to be maintained.

Next step: Finance needs to model the impact of a 5% traffic decline on the FY2026 EBITDA forecast by the end of the week.