Sonic Co. (SONC) Sees Significant Decrease in Short Interest

Sonic Co. (NASDAQ:SONC) was the recipient of a significant decline in short interest in September. As of September 28th, there was short interest totalling 1,600,282 shares, a decline of 68.0% from the September 14th total of 5,001,415 shares. Approximately 4.7% of the company’s shares are sold short. Based on an average daily trading volume, of 2,976,180 shares, the short-interest ratio is presently 0.5 days.

Shares of NASDAQ:SONC opened at $43.26 on Friday. The company has a debt-to-equity ratio of -2.62, a current ratio of 1.78 and a quick ratio of 1.78. The firm has a market capitalization of $1.54 billion, a P/E ratio of 34.62, a P/E/G ratio of 1.86 and a beta of 1.47. Sonic has a 12-month low of $23.22 and a 12-month high of $44.87.

Sonic announced that its Board of Directors has initiated a share repurchase program on Thursday, July 12th that authorizes the company to repurchase $500.00 million in shares. This repurchase authorization authorizes the restaurant operator to buy up to 39.6% of its stock through open market purchases. Stock repurchase programs are typically an indication that the company’s management believes its shares are undervalued.

In other news, VP Carolyn C. Cummins sold 2,500 shares of the business’s stock in a transaction on Monday, October 1st. The shares were sold at an average price of $43.31, for a total transaction of $108,275.00. The transaction was disclosed in a legal filing with the SEC, which is available through this hyperlink. Also, VP E Edward Saroch sold 21,896 shares of the business’s stock in a transaction on Tuesday, July 17th. The stock was sold at an average price of $36.46, for a total transaction of $798,328.16. The disclosure for this sale can be found here. Over the last ninety days, insiders have sold 115,696 shares of company stock worth $4,839,037. 8.28% of the stock is currently owned by corporate insiders.

Large investors have recently modified their holdings of the stock. Point72 Asset Management L.P. increased its stake in shares of Sonic by 109.0% in the second quarter. Point72 Asset Management L.P. now owns 4,500 shares of the restaurant operator’s stock worth $155,000 after buying an additional 54,500 shares during the last quarter. SG Americas Securities LLC increased its stake in shares of Sonic by 70.9% in the first quarter. SG Americas Securities LLC now owns 6,285 shares of the restaurant operator’s stock worth $159,000 after buying an additional 2,608 shares during the last quarter. Engineers Gate Manager LP bought a new stake in shares of Sonic in the second quarter worth $210,000. Oppenheimer & Co. Inc. bought a new stake in shares of Sonic in the second quarter worth $215,000. Finally, Parametrica Management Ltd bought a new stake in shares of Sonic in the second quarter worth $221,000.

A number of research analysts have recently commented on the stock. Morgan Stanley boosted their target price on shares of Sonic from $34.00 to $43.50 and gave the stock an “equal weight” rating in a research report on Thursday, September 27th. Barclays raised shares of Sonic from an “underweight” rating to an “equal weight” rating in a research report on Wednesday, September 26th. Stephens cut shares of Sonic from an “overweight” rating to an “equal weight” rating and boosted their target price for the stock from $40.00 to $43.50 in a research report on Wednesday, September 26th. Piper Jaffray Companies cut shares of Sonic from an “overweight” rating to a “neutral” rating in a research report on Tuesday, September 25th. Finally, William Blair cut shares of Sonic from an “outperform” rating to a “market perform” rating in a research report on Tuesday, September 25th. Thirteen research analysts have rated the stock with a hold rating, three have given a buy rating and one has assigned a strong buy rating to the stock. The stock currently has a consensus rating of “Hold” and a consensus target price of $35.88.

About Sonic

Sonic Corp. operates and franchises a chain of quick-service drive-in restaurants in the United States. As of August 31, 2017, the company operated 3,593 Sonic Drive-Ins in 45 states, of which 228 were owned and operated by the company and 3,365 were owned and operated by franchisees. The company also owns and leases 135 properties; and sublease 53 properties to franchisees and other parties.

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