Oppenheimer Weighs in on Sonic Co.’s FY2018 Earnings (SONC)

Sonic Co. (NASDAQ:SONC) – Oppenheimer upped their FY2018 earnings per share (EPS) estimates for shares of Sonic in a research note issued to investors on Friday. Oppenheimer analyst B. Bittner now forecasts that the restaurant operator will earn $1.53 per share for the year, up from their prior forecast of $1.49. Oppenheimer currently has a “Hold” rating on the stock. Oppenheimer also issued estimates for Sonic’s FY2019 earnings at $1.73 EPS.

A number of other brokerages also recently commented on SONC. Guggenheim restated a “buy” rating and issued a $31.00 target price (up from $29.00) on shares of Sonic in a research note on Thursday, December 28th. Canaccord Genuity restated a “hold” rating and issued a $30.00 target price on shares of Sonic in a research note on Friday. UBS Group restated a “neutral” rating and issued a $28.00 target price (up from $26.00) on shares of Sonic in a research note on Friday. Telsey Advisory Group restated a “market perform” rating and issued a $31.00 target price (up from $27.00) on shares of Sonic in a research note on Friday. Finally, Cowen reiterated a “hold” rating and set a $29.00 price objective on shares of Sonic in a research report on Tuesday. One research analyst has rated the stock with a sell rating, nine have given a hold rating and five have assigned a buy rating to the company’s stock. The stock has a consensus rating of “Hold” and a consensus price target of $29.14.

Shares of Sonic (SONC) traded down $0.77 during mid-day trading on Monday, reaching $27.26. The company’s stock had a trading volume of 1,708,400 shares, compared to its average volume of 1,958,680. The company has a debt-to-equity ratio of -2.87, a quick ratio of 1.48 and a current ratio of 1.81. Sonic has a 12 month low of $22.11 and a 12 month high of $30.05. The firm has a market capitalization of $1,080.00, a P/E ratio of 18.67, a P/E/G ratio of 1.38 and a beta of 1.73.

Sonic (NASDAQ:SONC) last issued its earnings results on Thursday, January 4th. The restaurant operator reported $0.30 EPS for the quarter, beating the Zacks’ consensus estimate of $0.25 by $0.05. Sonic had a negative return on equity of 28.95% and a net margin of 13.68%. The company had revenue of $105.40 million during the quarter, compared to the consensus estimate of $106.86 million. During the same period in the previous year, the firm posted $0.24 earnings per share. Sonic’s quarterly revenue was down 18.7% compared to the same quarter last year.

Sonic announced that its Board of Directors has approved a stock buyback program on Thursday, October 26th that permits the company to buyback $160.00 million in outstanding shares. This buyback authorization permits the restaurant operator to buy up to 14.9% of its shares through open market purchases. Shares buyback programs are usually an indication that the company’s board of directors believes its shares are undervalued.

In related news, Director Frank E. Richardson III sold 50,000 shares of the business’s stock in a transaction that occurred on Thursday, October 26th. The stock was sold at an average price of $25.59, for a total transaction of $1,279,500.00. Following the sale, the director now owns 1,187,659 shares of the company’s stock, valued at $30,392,193.81. The sale was disclosed in a filing with the SEC, which is available through the SEC website. Also, VP Carolyn C. Cummins sold 2,347 shares of the business’s stock in a transaction that occurred on Thursday, November 30th. The stock was sold at an average price of $25.43, for a total value of $59,684.21. The disclosure for this sale can be found here. Over the last quarter, insiders have sold 167,587 shares of company stock valued at $4,537,647. Insiders own 8.28% of the company’s stock.

A number of large investors have recently made changes to their positions in SONC. Schwab Charles Investment Management Inc. raised its holdings in Sonic by 6.6% during the second quarter. Schwab Charles Investment Management Inc. now owns 204,401 shares of the restaurant operator’s stock worth $5,415,000 after purchasing an additional 12,643 shares in the last quarter. Legal & General Group Plc raised its holdings in Sonic by 5.0% during the second quarter. Legal & General Group Plc now owns 81,826 shares of the restaurant operator’s stock worth $2,168,000 after purchasing an additional 3,862 shares in the last quarter. BNP Paribas Arbitrage SA raised its holdings in Sonic by 37.9% during the second quarter. BNP Paribas Arbitrage SA now owns 21,140 shares of the restaurant operator’s stock worth $560,000 after purchasing an additional 5,813 shares in the last quarter. Victory Capital Management Inc. raised its holdings in Sonic by 8.1% during the second quarter. Victory Capital Management Inc. now owns 18,464 shares of the restaurant operator’s stock worth $489,000 after purchasing an additional 1,380 shares in the last quarter. Finally, Wells Fargo & Company MN raised its holdings in Sonic by 28.7% during the second quarter. Wells Fargo & Company MN now owns 79,892 shares of the restaurant operator’s stock worth $2,116,000 after purchasing an additional 17,822 shares in the last quarter.

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About Sonic

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.

Earnings History and Estimates for Sonic (NASDAQ:SONC)

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