Sonic Corp. (NASDAQ:SONC) – Stock analysts at William Blair lowered their FY2019 EPS estimates for Sonic in a research report issued on Wednesday. William Blair analyst S. Zackfia now expects that the restaurant operator will earn $1.52 per share for the year, down from their previous estimate of $1.53.
A number of other research analysts have also weighed in on the company. BidaskClub raised Sonic from a “sell” rating to a “hold” rating in a report on Saturday, December 2nd. Zacks Investment Research raised Sonic from a “sell” rating to a “hold” rating in a report on Friday, November 3rd. Oppenheimer reissued a “buy” rating and issued a $29.00 target price on shares of Sonic in a report on Tuesday, October 17th. Canaccord Genuity upped their target price on Sonic from $24.00 to $25.00 and gave the company a “hold” rating in a report on Tuesday, October 17th. Finally, Cowen reissued a “neutral” rating on shares of Sonic in a report on Tuesday, October 17th. Two research analysts have rated the stock with a sell rating, seven have issued a hold rating and five have given a buy rating to the company’s stock. The stock has a consensus rating of “Hold” and a consensus target price of $27.73.
Sonic (NASDAQ:SONC) last released its earnings results on Monday, October 16th. The restaurant operator reported $0.45 earnings per share (EPS) for the quarter, beating the Zacks’ consensus estimate of $0.43 by $0.02. Sonic had a negative return on equity of 33.92% and a net margin of 13.34%. The business had revenue of $123.60 million for the quarter, compared to analyst estimates of $126.01 million. During the same quarter in the previous year, the company posted $0.45 earnings per share. The company’s revenue for the quarter was down 23.8% compared to the same quarter last year.
Institutional investors have recently added to or reduced their stakes in the company. Riverhead Capital Management LLC raised its holdings in shares of Sonic 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 grew its stake in shares of Sonic by 74.5% in the second quarter. Flinton Capital Management LLC now owns 6,290 shares of the restaurant operator’s stock valued at $167,000 after buying an additional 2,686 shares in the last quarter. Aperio Group LLC grew its stake in shares of Sonic by 1.4% in the second quarter. Aperio Group LLC now owns 8,348 shares of the restaurant operator’s stock valued at $221,000 after buying an additional 119 shares in the last quarter. Bayesian Capital Management LP acquired a new stake in shares of Sonic in the second quarter valued at about $228,000. Finally, Wolverine Trading LLC grew its stake in shares of Sonic by 382.4% in the third quarter. Wolverine Trading LLC now owns 9,110 shares of the restaurant operator’s stock valued at $232,000 after buying an additional 12,336 shares in the last quarter.
In related news, Director Frank E. Richardson III sold 50,000 shares of the stock in a transaction dated Wednesday, December 13th. The stock was sold at an average price of $28.40, for a total transaction of $1,420,000.00. The transaction was disclosed in a filing with the SEC, which can be accessed through the SEC website. Also, 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 completion of the transaction, the director now owns 1,187,659 shares in the company, valued at $29,929,006.80. The disclosure for this sale can be found here. Insiders have sold 167,587 shares of company stock worth $4,537,647 over the last quarter. 6.24% of the stock is currently owned by company insiders.
Sonic announced that its board has initiated a share repurchase plan on Thursday, October 26th that authorizes the company to repurchase $160.00 million in shares. This repurchase authorization authorizes the restaurant operator to buy up to 14.9% of its stock through open market purchases. Stock repurchase plans are typically an indication that the company’s board believes its shares are undervalued.
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Sonic Company Profile
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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