Financial Analysis of the Cheesecake Factory
Table of Contents
Introduction .3
Section 1 .. .3
Section 2- Ratio Analysis ... 8
Table 1- Ratio Analysis for 3 restaurants ... ..8
Section 3- Vertical Analysis 9
Table 2- Vertical/Common Size Analysis ... 9
Section 4- Major Elements of Cash Flow .10
Table 3- Cash Flow Comparison for 3 restaurants ... ..10 Figure 1- Comparison of Net Income ... 11 Figure 2- Comparison of Net Cash Flow from Operating Activities . .11 Figure 3- Comparison of Net Cash Flow from Investing Activities 12
Figure 4- Comparison of Net Cash Flow from Financing Activities ...12
Figure 5- Comparison of Net Change in Cash ..13
Figure 3- Comparison of Free Cash Flow .13
Section 5- Horizontal Analysis ..14
Table 4- Horizontal Analysis for 3 restaurants ... 14
Appendix of Financial Statements ..15
The Cheesecake Factory(CF), which first went public in September 1992, is a strong player in the full-service restaurant industry. It is one of the fastest growing restaurant chains with over 85 restaurants nationwide. Cheesecake Factory currently has 51.824 million common shares of stock outstanding with a market value that fluctuates around $40-$45 per share. Since turning public, the restaurant has thrived because it has successfully been able to increase sales and net income annually, produce healthy profit margins, and provide a sound return on equity for its shareholders. The Cheesecake Factory is unique in that it has maintained a Debt to Capital Ratio of 0% since turning public. The restaurant chain does not have any outstanding debt! In comparison to other full service restaurants in the industry, Cheesecake Factory has historically reported higher operating revenues, net income and return on assets. The numbers for this restaurant are optimistic. As long as Cheesecake Factory continues to
Introduction .3
Section 1 .. .3
Section 2- Ratio Analysis ... 8
Table 1- Ratio Analysis for 3 restaurants ... ..8
Section 3- Vertical Analysis 9
Table 2- Vertical/Common Size Analysis ... 9
Section 4- Major Elements of Cash Flow .10
Table 3- Cash Flow Comparison for 3 restaurants ... ..10 Figure 1- Comparison of Net Income ... 11 Figure 2- Comparison of Net Cash Flow from Operating Activities . .11 Figure 3- Comparison of Net Cash Flow from Investing Activities 12
Figure 4- Comparison of Net Cash Flow from Financing Activities ...12
Figure 5- Comparison of Net Change in Cash ..13
Figure 3- Comparison of Free Cash Flow .13
Section 5- Horizontal Analysis ..14
Table 4- Horizontal Analysis for 3 restaurants ... 14
Appendix of Financial Statements ..15
The Cheesecake Factory(CF), which first went public in September 1992, is a strong player in the full-service restaurant industry. It is one of the fastest growing restaurant chains with over 85 restaurants nationwide. Cheesecake Factory currently has 51.824 million common shares of stock outstanding with a market value that fluctuates around $40-$45 per share. Since turning public, the restaurant has thrived because it has successfully been able to increase sales and net income annually, produce healthy profit margins, and provide a sound return on equity for its shareholders. The Cheesecake Factory is unique in that it has maintained a Debt to Capital Ratio of 0% since turning public. The restaurant chain does not have any outstanding debt! In comparison to other full service restaurants in the industry, Cheesecake Factory has historically reported higher operating revenues, net income and return on assets. The numbers for this restaurant are optimistic. As long as Cheesecake Factory continues to