Zacks Investment Research upgraded shares of Sonic Corp. (NASDAQ:SONC) from a sell rating to a hold rating in a research note released on Friday.
According to Zacks, “Sonic Corp. operates and franchises one of the largest chain of drive-in restaurants in the United States. Sonic restaurants offer made-to-order hamburgers and other sandwiches and feature Sonic signature items, such as footlong coney cheese dogs, hand-battered onion rings, tater tots, specialty soft drinks, including cherry limeades and slushes, and frozen desserts. At a typical Sonic restaurant, a customer drives into one of 24 to 36 covered drive-in spaces, orders through an intercom, and has the food delivered by a carhop within an average of four minutes. “
Several other research firms have also recently issued reports on SONC. BidaskClub cut Sonic Corp. from a hold rating to a sell rating in a research report on Sunday, July 16th. Bank of America Corporation reiterated a buy rating and issued a $30.00 price objective on shares of Sonic Corp. in a research report on Monday, August 14th. Piper Jaffray Companies reiterated a buy rating and issued a $32.00 price objective on shares of Sonic Corp. in a research report on Wednesday, July 26th. Canaccord Genuity increased their price objective on Sonic Corp. from $24.00 to $25.00 and gave the stock a hold rating in a research report on Tuesday, October 17th. Finally, Jefferies Group LLC reiterated a hold rating and issued a $26.00 price objective on shares of Sonic Corp. in a research report on Thursday, July 27th. Three investment analysts have rated the stock with a sell rating, eight have given a hold rating and five have assigned a buy rating to the company’s stock. The stock currently has an average rating of Hold and a consensus price target of $27.73.
Shares of Sonic Corp. (NASDAQ:SONC) traded down $0.62 during mid-day trading on Friday, hitting $24.33. The stock had a trading volume of 135,851 shares, compared to its average volume of 1,044,036. Sonic Corp. has a twelve month low of $22.11 and a twelve month high of $30.05. The company has a quick ratio of 1.48, a current ratio of 1.52 and a debt-to-equity ratio of -3.19. The stock has a market capitalization of $1,004.25, a P/E ratio of 19.65, a price-to-earnings-growth ratio of 1.27 and a beta of 1.75.
Sonic Corp. (NASDAQ:SONC) last released its quarterly earnings results on Monday, October 16th. The restaurant operator reported $0.45 EPS for the quarter, topping the Thomson Reuters’ consensus estimate of $0.43 by $0.02. Sonic Corp. had a negative return on equity of 33.92% and a net margin of 13.34%. The business had revenue of $123.60 million during the quarter, compared to analysts’ expectations of $126.01 million. During the same quarter in the prior year, the business earned $0.45 earnings per share. The company’s quarterly revenue was down 23.8% compared to the same quarter last year. analysts anticipate that Sonic Corp. will post 1.34 EPS for the current fiscal year.
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Sonic Corp. announced that its Board of Directors has initiated a share repurchase program on Wednesday, August 9th that allows the company to repurchase $160.00 million in outstanding shares. This repurchase authorization allows the restaurant operator to purchase up to 16.2% of its shares through open market purchases. Shares repurchase programs are often an indication that the company’s management believes its shares are undervalued.
The firm also recently declared a quarterly dividend, which will be paid on Friday, November 17th. Shareholders of record on Wednesday, November 8th will be paid a $0.16 dividend. This represents a $0.64 dividend on an annualized basis and a yield of 2.63%. This is a positive change from Sonic Corp.’s previous quarterly dividend of $0.14. The ex-dividend date is Tuesday, November 7th. Sonic Corp.’s dividend payout ratio (DPR) is presently 38.10%.
In other Sonic Corp. news, Director Federico F. Pena sold 1,161 shares of the firm’s stock in a transaction dated Monday, October 23rd. The stock was sold at an average price of $25.20, for a total value of $29,257.20. Following the sale, the director now directly owns 1,187,659 shares of the company’s stock, valued at approximately $29,929,006.80. The sale was disclosed in a filing with the SEC, which can be accessed through this link. Also, Director Frank E. Richardson III sold 50,000 shares of the firm’s stock in a transaction dated Thursday, October 26th. The stock was sold at an average price of $25.59, for a total value of $1,279,500.00. Following the completion of the sale, the director now directly owns 1,187,659 shares in the company, valued at $30,392,193.81. The disclosure for this sale can be found here. 6.24% of the stock is currently owned by company insiders.
Several institutional investors have recently added to or reduced their stakes in SONC. Riverhead Capital Management LLC raised its holdings in shares of Sonic Corp. by 77.7% in the 2nd quarter. Riverhead Capital Management LLC now owns 4,797 shares of the restaurant operator’s stock worth $127,000 after purchasing an additional 2,097 shares during the period. Flinton Capital Management LLC raised its holdings in shares of Sonic Corp. by 74.5% in the 2nd quarter. Flinton Capital Management LLC now owns 6,290 shares of the restaurant operator’s stock worth $167,000 after purchasing an additional 2,686 shares during the period. Karp Capital Management Corp purchased a new position in shares of Sonic Corp. in the 1st quarter worth about $209,000. Aperio Group LLC raised its holdings in shares of Sonic Corp. by 1.4% in the 2nd quarter. Aperio Group LLC now owns 8,348 shares of the restaurant operator’s stock worth $221,000 after purchasing an additional 119 shares during the period. Finally, State of Alaska Department of Revenue raised its holdings in shares of Sonic Corp. by 72.7% in the 2nd quarter. State of Alaska Department of Revenue now owns 8,378 shares of the restaurant operator’s stock worth $221,000 after purchasing an additional 3,528 shares during the period.
About Sonic Corp.
Sonic Corp. operates and franchises the chain of drive-thru restaurants (Sonic Drive-Ins) in the United States. As of August 31, 2016, 3,557 Sonic Drive-Ins were in operation from coast to coast in 45 states, consisting of 345 Company drive-thrus and 3,212 franchise drive-thrus. As of August 31, 2016, its restaurant design and construction consisted of a kitchen housed in a one-story building, which was approximately 1,500 square feet, flanked by canopy-covered rows of 16 to 24 parking spaces, with each space having its own payment terminal, intercom speaker system and menu board.
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