Sonic Drive-In (SONC) Upgraded at Zacks Investment Research

Sonic Drive-In (NASDAQ:SONC) was upgraded by Zacks Investment Research from a “hold” rating to a “buy” rating in a research note issued on Thursday. The firm presently has a $41.00 price objective on the restaurant operator’s stock. Zacks Investment Research‘s price target suggests a potential upside of 13.23% from the company’s current price.

According to Zacks, “Sonic Corp., America’s Drive-in has built a dominant position in the drive-in restaurant business. They did it by sticking to what made drive-ins so popular in the first place: made-to-order American classics, signature menu items, speedy service from friendly Carhops and heaping helpings of fun and personality. Today, Sonic is the largest chain of drive-in restaurants in America. As a business, they continue to thrive, maintaining strong real sales growth, industry-leading customer frequency and high returns for their stockholders. So take a cruise through their website to learn more about our company and the people who help make it an American success story. “

Several other equities research analysts have also recently issued reports on the stock. Barclays decreased their price objective on shares of Sonic Drive-In from $28.00 to $25.00 and set an “underweight” rating for the company in a research report on Wednesday, March 28th. Cowen decreased their price objective on shares of Sonic Drive-In from $29.00 to $28.00 and set a “market perform” rating for the company in a research report on Wednesday, March 28th. BidaskClub cut shares of Sonic Drive-In from a “buy” rating to a “hold” rating in a research report on Saturday, May 5th. Morgan Stanley decreased their price objective on shares of Sonic Drive-In from $29.00 to $28.00 and set an “equal weight” rating for the company in a research report on Monday, March 26th. Finally, ValuEngine cut shares of Sonic Drive-In from a “hold” rating to a “sell” rating in a research report on Wednesday, May 9th. One investment analyst has rated the stock with a sell rating, eight have given a hold rating and seven have assigned a buy rating to the company’s stock. The company presently has an average rating of “Hold” and an average target price of $31.57.

Shares of Sonic Drive-In opened at $36.21 on Thursday, MarketBeat reports. The company has a debt-to-equity ratio of -2.62, a current ratio of 1.78 and a quick ratio of 1.78. Sonic Drive-In has a 52 week low of $22.11 and a 52 week high of $36.84. The company has a market capitalization of $1.31 billion, a price-to-earnings ratio of 28.97, a price-to-earnings-growth ratio of 1.68 and a beta of 1.48.

Sonic Drive-In (NASDAQ:SONC) last issued its quarterly earnings results on Tuesday, June 26th. The restaurant operator reported $0.52 EPS for the quarter, beating the Thomson Reuters’ consensus estimate of $0.49 by $0.03. Sonic Drive-In had a net margin of 16.87% and a negative return on equity of 23.60%. The company had revenue of $118.30 million during the quarter, compared to analysts’ expectations of $119.31 million. During the same quarter last year, the company posted $0.43 EPS. The firm’s revenue was down 4.6% compared to the same quarter last year. equities analysts forecast that Sonic Drive-In will post 1.48 EPS for the current fiscal year.

Sonic Drive-In declared that its Board of Directors has approved a stock repurchase program on Thursday, June 7th that authorizes the company to buyback $500.00 million in shares. This buyback authorization authorizes the restaurant operator to buy up to 42.2% of its shares through open market purchases. Shares buyback programs are usually a sign that the company’s board believes its stock is undervalued.

A number of hedge funds have recently modified their holdings of SONC. Glenmede Trust Co. NA increased its position in shares of Sonic Drive-In by 97.2% in the fourth quarter. Glenmede Trust Co. NA now owns 4,634 shares of the restaurant operator’s stock worth $126,000 after acquiring an additional 2,284 shares in the last quarter. SG Americas Securities LLC lifted its position in shares of Sonic Drive-In by 70.9% in the 1st quarter. SG Americas Securities LLC now owns 6,285 shares of the restaurant operator’s stock worth $159,000 after buying an additional 2,608 shares during the last quarter. Elkfork Partners LLC acquired a new stake in shares of Sonic Drive-In in the 4th quarter worth about $209,000. Xact Kapitalforvaltning AB acquired a new stake in shares of Sonic Drive-In in the 1st quarter worth about $222,000. Finally, Atria Investments LLC acquired a new stake in shares of Sonic Drive-In in the 2nd quarter worth about $295,000.

Sonic Drive-In Company Profile

Sonic Corp. operates and franchises a chain of quick-service drive-in restaurants in the United States. As of August 31, 2017, the company operated 3,593 Sonic Drive-Ins in 45 states, of which 228 were owned and operated by the company and 3,365 were owned and operated by franchisees. The company also owns and leases 135 properties; and sublease 53 properties to franchisees and other parties.

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