What Happened?
Shares of restaurant company Cracker Barrel (NASDAQ: CBRL) jumped 6.8% in the afternoon session after activist investor Sardar Biglari increased his stake in the company, a move that came as bearish bets against the stock also rose.
Biglari's firm, Biglari Holdings Inc., acquired an additional 50,100 shares, boosting his total ownership to over 16.3% of the family-dining chain. This significant purchase signaled confidence from a major investor. At the same time, short interest in Cracker Barrel had climbed by 17.43%. This meant that a large number of traders, equivalent to 37.66% of all available shares, were betting the stock price would fall. The combination of a large buy from an activist and high short interest may have created upward pressure on the stock, as those betting against it were forced to buy shares back to cover their positions.
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What Is The Market Telling Us
Cracker Barrel’s shares are extremely volatile and have had 41 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 9 days ago when the stock gained 8.5% on the news that analysts at Bernstein highlighted a potential recovery for the sector in 2026.
After a challenging 2025 marked by weakened consumer confidence, the firm anticipates a gradual traffic recovery. Several factors could stimulate consumer demand, including an upcoming Tax Bill and the U.S.-hosted Soccer World Cup, with effects potentially starting in the spring. This optimistic outlook was supported by restaurant valuations hitting 10-year lows, suggesting significant upside if consumer spending data improves. Following a period where households cut back on dining out due to inflation, larger tax rebate checks are also seen as a potential catalyst for a rebound in casual dining.
Cracker Barrel is up 35.2% since the beginning of the year, but at $36.31 per share, it is still trading 49.5% below its 52-week high of $71.86 from July 2025. Investors who bought $1,000 worth of Cracker Barrel’s shares 5 years ago would now be looking at an investment worth $257.43.
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