Sonic’s (NASDAQ:SONC) “Neutral” Rating Reaffirmed at UBS Group

UBS Group restated their neutral rating on shares of Sonic (NASDAQ:SONC) in a research report report published on Friday, January 5th, 99wallstreet.com reports. UBS Group currently has a $28.00 price objective on the restaurant operator’s stock, up from their prior price objective of $26.00.

Several other research firms also recently issued reports on SONC. Guggenheim reissued a buy rating and issued a $31.00 target price (up previously from $29.00) on shares of Sonic in a research note on Thursday, December 28th. Oppenheimer downgraded shares of Sonic from an outperform rating to a market perform rating and set a $29.00 target price for the company. in a research note on Thursday, January 4th. Telsey Advisory Group reissued a market perform rating and issued a $31.00 target price (up previously from $27.00) on shares of Sonic in a research note on Friday, January 5th. Zacks Investment Research downgraded shares of Sonic from a hold rating to a sell rating in a research note on Thursday, October 19th. Finally, BidaskClub raised shares of Sonic from a sell rating to a hold rating in a research note on Saturday, December 2nd. 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 stock. The company presently has a consensus rating of Hold and an average price target of $29.36.

Sonic (NASDAQ:SONC) traded down $0.39 during trading hours on Friday, reaching $25.95. 426,098 shares of the company were exchanged, compared to its average volume of 981,164. Sonic has a 1 year low of $22.11 and a 1 year high of $30.05. The company has a current ratio of 1.81, a quick ratio of 1.81 and a debt-to-equity ratio of -2.87. The stock has a market cap of $997.99, a price-to-earnings ratio of 17.77, a price-to-earnings-growth ratio of 1.18 and a beta of 1.73.

Sonic (NASDAQ:SONC) last released its earnings results on Thursday, January 4th. The restaurant operator reported $0.30 EPS for the quarter, beating analysts’ consensus estimates 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 quarter last year, the company earned $0.24 earnings per share. Sonic’s quarterly revenue was down 18.7% compared to the same quarter last year. equities research analysts anticipate that Sonic will post 1.52 earnings per share for the current year.

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

The company also recently announced a quarterly dividend, which will be paid on Friday, February 16th. Stockholders of record on Wednesday, February 7th will be issued a dividend of $0.16 per share. This represents a $0.64 dividend on an annualized basis and a dividend yield of 2.47%. Sonic’s payout ratio is currently 43.84%.

In other Sonic news, Director Frank E. Richardson III sold 3,670 shares of the company’s stock in a transaction that occurred on Monday, December 18th. The stock was sold at an average price of $28.21, for a total value of $103,530.70. Following the transaction, the director now directly owns 1,061,699 shares of the company’s stock, valued at approximately $29,950,528.79. The sale was disclosed in a filing with the SEC, which is accessible through the SEC website. Also, VP Carolyn C. Cummins sold 2,347 shares of the company’s stock in a transaction that occurred on Thursday, November 30th. The shares were 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. In the last 90 days, insiders sold 167,587 shares of company stock valued at $4,537,647. 8.28% of the stock is owned by company insiders.

Hedge funds have recently bought and sold shares of the stock. Riverhead Capital Management LLC grew its stake in Sonic by 77.7% during the 2nd quarter. Riverhead Capital Management LLC now owns 4,797 shares of the restaurant operator’s stock worth $127,000 after buying an additional 2,097 shares during the last quarter. Flinton Capital Management LLC grew its stake in Sonic by 74.5% during the 2nd quarter. Flinton Capital Management LLC now owns 6,290 shares of the restaurant operator’s stock worth $167,000 after buying an additional 2,686 shares during the last quarter. Bayesian Capital Management LP bought a new position in Sonic during the 2nd quarter worth $228,000. Wolverine Trading LLC grew its stake in Sonic by 382.4% during the 3rd quarter. Wolverine Trading LLC now owns 9,110 shares of the restaurant operator’s stock worth $232,000 after buying an additional 12,336 shares during the last quarter. Finally, Piedmont Investment Advisors LLC bought a new position in Sonic during the 2nd quarter worth $244,000.

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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.

Analyst Recommendations for Sonic (NASDAQ:SONC)

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