Cracker Barrel (CBRL) PT Raised to $178 at Truist Securities, Convertible Note Adds Value

Truist Securities analyst Jake Bartlett raised the price target on Cracker Barrel (NASDAQ: CBRL) to $178.00 (from $171.00) while maintaining a Buy rating.

The analyst commented, "We believe that CBRL recent issuance (6/16/21) of convertible notes adds shareholder value and are increasing ests. and our PT to $178. The issuance, and pay down of existing debt (0.625% coupon vs. our est. of 3.0-3.50% over the next 3 years) lowers CBRL's interest rate significantly. Including the related hedging (offsets dilution) and the high transaction costs, we estimate an implied ~3.2% interest rate on the convertible note, which is attractive for fixed rate debt. The repurchase of $35M in shares suggests that CBRL is back to returning cash to shareholders as it exits the pandemic."

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