Restaurant stocks downgraded

Raymond James says O'Charley's, Cracker Barrel outperformers no more

Email | Print By Geert De Lombaerde

Raymond James analyst Bryan Elliott today downgraded a host of restaurant stocks, including those of locals O'Charley's and CBRL Group, the parent of Cracker Barrel.

Elliott now has O'Charley's (Ticker: CHUX) at 'market perform' and CBRL (Ticker: CBRL) at 'market underperform.' He had previously rated both 'outperform.'

Shares of both companies followed the broader market lower today. Heading into the close, O'Charley's was off 4.8 percent, CBRL 2.5 percent. All three major indices were down almost 3 percent on the day after Labor Department figures showed unemployment claims at their highest since 2003.

Elliott last month told the Chicago Tribune that "these stocks are very, very, very cheap because their fundamentals keep getting a little worse." But, he added, investors with longer time horizons stand to enjoy a big pop when the fundamentals turn.