📊 CAKE Key Takeaways
Is Cheesecake Factory Inc. (CAKE) a Good Investment?
Cheesecake Factory demonstrates adequate profitability and strong debt service capacity with 14.9x interest coverage, but faces material headwinds: zero revenue growth despite an inflationary environment signals competitive pressure or market saturation, while diluted EPS declined 4.4% YoY despite flat topline revenues, indicating margin compression and operational stress. Critically, weak liquidity ratios (current 0.59x, quick 0.53x) combined with elevated leverage (1.22x debt-to-equity) and anemic asset returns (ROA 1.5%) suggest limited financial flexibility for a capital-intensive restaurant operator.
The Cheesecake Factory shows solid fundamental resilience through positive free cash flow, strong interest coverage, and healthy absolute profitability, but growth quality is muted with flat revenue and net income and declining diluted EPS. The business appears financially stable rather than accelerating, with leverage and weak liquidity limiting the margin for error.
Why Buy Cheesecake Factory Inc. Stock? CAKE Key Strengths
- Strong interest coverage ratio of 14.9x demonstrates robust capacity to service $562.1M debt load
- Positive free cash flow generation of $53.3M (5.5% FCF margin) provides operational flexibility
- Profitable with 5.1% net margin, generating $49.5M net income in competitive restaurant sector
- Consistent profitability with $148.43M net income and a 5.0% operating margin
- Positive free cash flow of $155.08M and solid operating cash flow of $301.28M
- Very strong interest coverage of 50.7x, indicating manageable debt servicing capacity
CAKE Stock Risks: Cheesecake Factory Inc. Investment Risks
- Zero YoY revenue growth ($978.8M flat) signals lost pricing power and potential market share challenges in inflationary environment
- Diluted EPS declined 4.4% YoY despite flat revenues, confirming margin compression and cost control deterioration
- Liquidity crisis indicators: current ratio 0.59x and quick ratio 0.53x (both below 1.0) raise acute short-term solvency concerns given capital-intensive operations
- Revenue and net income are flat year over year, pointing to limited growth momentum
- Low current ratio of 0.59x and quick ratio of 0.52x indicate tight near-term liquidity
- High ROE is partly driven by a small equity base and leverage, with debt/equity at 1.29x
Key Metrics to Watch
- Top-line revenue growth trajectory - must demonstrate positive growth to restore confidence
- Operating margin trend - monitor cost inflation impact on profitability sustainability
- Current ratio and working capital position - critical to prevent liquidity stress given debt obligations
- Comparable sales and revenue growth
- Free cash flow generation relative to capital expenditures
Cheesecake Factory Inc. (CAKE) Financial Metrics & Key Ratios
💡 AI Analyst Insight
The current ratio below 1.0x warrants monitoring of short-term liquidity.
CAKE Profit Margin, ROE & Profitability Analysis
CAKE vs Consumer Sector: How Cheesecake Factory Inc. Compares
How Cheesecake Factory Inc. compares to Consumer sector averages
Sector benchmarks are approximate industry averages. Actual sector performance may vary.
Is Cheesecake Factory Inc. Stock Overvalued? CAKE Valuation Analysis 2026
Based on fundamental analysis, Cheesecake Factory Inc. has mixed fundamental signals relative to the Consumer sector in 2026.
Note: This is a fundamental analysis based on SEC filings. For P/E ratio, price targets, and market-based valuation, consult financial data providers. This is not investment advice.
Cheesecake Factory Inc. Balance Sheet: CAKE Debt, Cash & Liquidity
CAKE Revenue & Earnings Growth: 5-Year Financial Trend
5-Year Trend Summary: Cheesecake Factory Inc.'s revenue has shown modest growth of 5% over the 5-year period. The most recent EPS of $2.07 reflects profitable operations.
CAKE Revenue Growth, EPS Growth & YoY Performance
CAKE Quarterly Earnings & Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q1 2026 | $927.2M | $32.9M | $0.67 |
| Q3 2025 | $865.5M | $30.0M | $0.61 |
| Q2 2025 | $904.0M | $52.4M | $1.08 |
| Q1 2025 | $891.2M | $32.9M | $0.67 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
Cheesecake Factory Inc. Dividends, Buybacks & Capital Allocation
CAKE SEC Filings: Latest 10-K & 10-Q Analysis
Access official SEC EDGAR filings for Cheesecake Factory Inc. (CIK: 0000887596)
📋 Recent SEC Filings
❓ Frequently Asked Questions about CAKE
What is the AI rating for CAKE?
Cheesecake Factory Inc. (CAKE) has a Combined AI Rating of SELL from Claude (SELL) and ChatGPT (HOLD) with 76% combined confidence, based on fundamental analysis of SEC EDGAR filings.
What are CAKE's key strengths?
Claude: Strong interest coverage ratio of 14.9x demonstrates robust capacity to service $562.1M debt load. Positive free cash flow generation of $53.3M (5.5% FCF margin) provides operational flexibility. ChatGPT: Consistent profitability with $148.43M net income and a 5.0% operating margin. Positive free cash flow of $155.08M and solid operating cash flow of $301.28M.
What are the risks of investing in CAKE?
Claude: Zero YoY revenue growth ($978.8M flat) signals lost pricing power and potential market share challenges in inflationary environment. Diluted EPS declined 4.4% YoY despite flat revenues, confirming margin compression and cost control deterioration. ChatGPT: Revenue and net income are flat year over year, pointing to limited growth momentum. Low current ratio of 0.59x and quick ratio of 0.52x indicate tight near-term liquidity.
What is CAKE's revenue and growth?
Cheesecake Factory Inc. reported revenue of $978.8M.
Does CAKE pay dividends?
Cheesecake Factory Inc. pays dividends, with $14.2M distributed to shareholders in the trailing twelve months.
Where can I find CAKE SEC filings?
Official SEC filings for Cheesecake Factory Inc. (CIK: 0000887596) including 10-K, 10-Q, and 8-K reports are available on SEC EDGAR.
What is CAKE's EPS?
Cheesecake Factory Inc. has a diluted EPS of $1.02.
How is the AI analysis conducted?
Two independent AI systems — Claude (Anthropic) and ChatGPT (OpenAI) — analyze SEC EDGAR filings including 10-K annual reports and 10-Q quarterly reports. Each AI evaluates financial health, profitability ratios, balance sheet strength, and growth metrics. The combined rating reflects both perspectives for balanced insights.
Is CAKE a good stock to buy right now?
Based on our AI fundamental analysis in May 2026, Cheesecake Factory Inc. has a SELL rating with 76% confidence. Review the strengths and risks sections above before making a decision. This is not investment advice.
Is CAKE stock overvalued or undervalued?
Valuation metrics for CAKE: ROE of 10.8% (sector avg: 18%), net margin of 5.1% (sector avg: 8%). Compare these metrics with sector averages to assess valuation.
Should I buy CAKE stock in 2026?
Our dual AI analysis gives Cheesecake Factory Inc. a combined SELL rating for 2026. Revenue is data pending, with profitability at or below sector average. Always conduct your own research.
What is CAKE's free cash flow?
Cheesecake Factory Inc.'s operating cash flow is $96.7M, with capital expenditures of $43.4M. FCF margin is 5.5%.
How does CAKE compare to other Consumer stocks?
Vs Consumer sector averages: Net margin 5.1% (avg: 8%), ROE 10.8% (avg: 18%), current ratio 0.59 (avg: 1.5).