Cheesecake Factory shares sink after downward revision of guidance
Cheesecake Factory Inc. shares were down 6.1% in Tuesday premarket trading after the restaurant chain issued a downward revision of its second-quarter guidance. Cheesecake Factory now expects second-quarter same-restaurant sales to decline about 1%, compared with previous guidance for an increase of 1% to 2%. The FactSet consensus is for a 1.7% increase. Cheesecake Factory expects the same-store sales decline to hurt second-quarter margins and earnings per share. The company has seen "more volatility in the week-to-week sales trends, indicative of uncertainty on the part of many consumers," said Chief Executive David Overton in a statement. "Specifically, we have seen pockets of softness as we moved through the quarter, notably in the East and Midwest where we also faced unfavorable weather that reduced patio usage." Cheesecake Factory shares are down 5.7% for the last three months while the S&P 500 index is up 2.4% for the period.
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