Cracker Barrel surges 35% as Wells Fargo upgrades on turnaround

Cracker Barrel Old Country Store shares surged as much as 35% Wednesday after Wells Fargo upgraded the stock to Overweight with a $50 price target.

"The turnaround is regaining ground," Wells Fargo said in a note, citing cheap valuation, easy year-over-year comparisons and about 27% short interest that could fuel further gains.

The upgrade followed fiscal third-quarter results that flipped an expected loss into a profit. Adjusted earnings per share came in at $0.29, compared with the consensus estimate for a loss of about $0.42. Revenue of $797.4 million topped the $777 million analysts had projected, though it fell 2.9% from a year earlier.

The stock hit an intraday high of $48.20, up from Tuesday's close of $36.30. About 27% of the float is held short, amplifying the move as short sellers covered positions. The company raised its full-year adjusted EBITDA outlook to as much as $125 million from a prior $100 million.

The upgrade from Wells Fargo was one of several positive analyst reactions. Citi and UBS also raised their price targets on the stock. The company declared a $0.25 quarterly dividend and benefited from a $47.4 million cash inflow tied to an interchange fee litigation settlement.

Chief Executive Officer Julie Masino said operational initiatives "continue to gain traction." Retail same-store sales outperformed restaurant same-store sales for the first time in more than four years, and a corporate restructuring is expected to deliver $20 million to $25 million in annualized general and administrative savings.

The stock has gained more than 80% year to date, recovering from a 50% decline from its July 2025 high. The rally unfolded against a declining broader market, with the S&P 500 falling 0.4% on Wednesday.

The upgrade and earnings beat mark a turning point for the casual dining chain, which had struggled with declining traffic and margin pressure. Investors will watch whether the company can sustain same-store sales growth in the coming quarters as it laps easier comparisons.

This article is for informational purposes only and does not constitute investment advice.