Equities Analysts Offer Predictions for Sonic Co.’s FY2019 Earnings (SONC)

Sonic Co. (NASDAQ:SONC) – Equities research analysts at William Blair decreased their FY2019 earnings per share estimates for shares of Sonic in a research report issued to clients and investors on Wednesday, according to Zacks Investment Research. William Blair analyst S. Zackfia now forecasts that the restaurant operator will earn $1.52 per share for the year, down from their prior estimate of $1.53.

A number of other analysts have also recently weighed in on the stock. Zacks Investment Research raised shares of Sonic from a “sell” rating to a “hold” rating in a research note on Thursday, October 26th. Citigroup assumed coverage on shares of Sonic in a report on Monday, September 18th. They set a “buy” rating and a $28.00 price target on the stock. Oppenheimer reiterated a “buy” rating and set a $29.00 price target on shares of Sonic in a report on Friday, October 6th. Guggenheim reiterated a “buy” rating and set a $31.00 price target (up previously from $29.00) on shares of Sonic in a report on Thursday, December 28th. Finally, Canaccord Genuity boosted their target price on shares of Sonic from $24.00 to $25.00 and gave the company a “hold” rating in a report on Tuesday, October 17th. Two investment analysts have rated the stock with a sell rating, seven have issued a hold rating and six have assigned a buy rating to the company’s stock. Sonic currently has an average rating of “Hold” and an average price target of $29.36.

Shares of Sonic (SONC) opened at $26.34 on Friday. The firm has a market cap of $1,012.98, a price-to-earnings ratio of 17.80, a price-to-earnings-growth ratio of 1.18 and a beta of 1.74. Sonic has a one year low of $22.11 and a one year high of $30.05. 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 (NASDAQ:SONC) last announced its quarterly earnings data on Thursday, January 4th. The restaurant operator reported $0.30 earnings per share (EPS) for the quarter, beating analysts’ consensus estimates of $0.25 by $0.05. The business had revenue of $105.40 million for the quarter, compared to analysts’ expectations of $106.86 million. Sonic had a net margin of 13.68% and a negative return on equity of 28.95%. The firm’s quarterly revenue was down 18.7% compared to the same quarter last year. During the same period last year, the firm posted $0.24 earnings per share.

A number of hedge funds have recently modified their holdings of the business. Aperio Group LLC grew its position in Sonic by 1.4% in the 2nd quarter. Aperio Group LLC now owns 8,348 shares of the restaurant operator’s stock worth $221,000 after purchasing an additional 119 shares in the last quarter. Victory Capital Management Inc. grew its position in Sonic by 8.1% in the 2nd 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. Great West Life Assurance Co. Can grew its position in Sonic by 2.4% in the 2nd quarter. Great West Life Assurance Co. Can now owns 63,326 shares of the restaurant operator’s stock worth $1,676,000 after purchasing an additional 1,476 shares in the last quarter. Riverhead Capital Management LLC grew its position in 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 in the last quarter. Finally, California Public Employees Retirement System grew its position in Sonic by 2.0% in the 2nd quarter. California Public Employees Retirement System now owns 111,900 shares of the restaurant operator’s stock worth $2,964,000 after purchasing an additional 2,200 shares in the last quarter.

In other news, Director Frank E. Richardson III sold 3,670 shares of the business’s stock in a transaction dated Monday, December 18th. The shares were sold at an average price of $28.21, for a total transaction of $103,530.70. Following the completion of the sale, the director now directly owns 1,061,699 shares of the company’s stock, valued at $29,950,528.79. The transaction was disclosed in a legal filing with the SEC, which is available at this hyperlink. Also, Director Federico F. Pena sold 1,161 shares of the business’s stock in a transaction dated Monday, October 23rd. The stock was sold at an average price of $25.20, for a total transaction of $29,257.20. Following the sale, the director now directly owns 1,187,659 shares of the company’s stock, valued at $29,929,006.80. The disclosure for this sale can be found here. Over the last three months, insiders have sold 167,587 shares of company stock valued at $4,537,647. 6.24% of the stock is currently owned by insiders.

Sonic announced that its Board of Directors has initiated a share buyback program on Thursday, October 26th that permits the company to repurchase $160.00 million in shares. This repurchase authorization permits the restaurant operator to purchase up to 14.9% of its shares through open market purchases. Shares repurchase programs are often a sign that the company’s board believes its stock is undervalued.

The firm also recently announced a quarterly dividend, which will be paid on Friday, February 16th. Stockholders of record on Wednesday, February 7th will be given a dividend of $0.16 per share. This represents a $0.64 annualized dividend and a dividend yield of 2.43%. Sonic’s payout ratio is presently 43.24%.

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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.

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