Analyze and discuss trends for total revenue, net income, earning per share and common stock price. Do research to explain up and down turns.

----------------EXCERPT-------------------------

Company Financial Performance

The Cheesecake Factory, Inc. is one of the biggest eateries and cheesecakes producers in the United States. David M. Overton founded the company in Beverly Hills, California in 1978. The company has 210 branches, with 194 of these outlets operating under Cheesecake brand name. In an effort to understand the companys performances, the analysis of its financials will be important. The most significant financial items for analysis will include revenues, net income, earnings per share and common stock price.

Revenues

The companys revenues have been experiencing growth over the last five years. Cheesecake Factory revenues for the last five years were $ 2.0 billion, $ 2.1 billion, $ 2.27 billion, $ 2.26 billion and $ 2.33 billion for 2014, 2015,2016, 2017 and 2018 fiscal periods respectively. The high growth in sales over the last five years has been primarily from an increase in new outlets and venturing in the foreign markets. The company anticipates that there will be continual growth in sales brought by the approaches of offering, innovative, high-quality menu items that offer customers a wide range of options, with the main concentration on taste, product price, and value (Cheesecake Factory, Inc). The business also intends to focus on services with the primary purpose of offering unforgettable experiences to customers experience. The company depends majorly on the sales of its outlets as its main income.

Net Income

Net income is one of the most important items in the income statement of Cheesecakes. It indicates the business performance during the financial period. The arrival of net income is by deduction of operating cost from the Gross Profits. The net income of the company in the last five years indicates a downward trend. The net incomes of the business in the last five years were $ 101.3 million, $ 116.5 million, $ 139.5 million, $ 157.4 million and $ 99.035 million in 2014, 2015, 2016, 2017 and 2018 financial periods [Check Appendix]. The continuous drop of net income was because of the decreases in gross profits of the firm. The decrease in gross profit was because of the increase in the cost of goods sold from $ 1.6 billion in the fiscal year 2014 to $ 1.9 billion in 2018 financial period. Moreover, the continuous decrease in net income was because of the increase in operating expenses. Business expenditure increased from $ $ 1.8 billion to $ 2.2 billion in between the span of 5 years. The notable expenditure items that increased include labor expenses that saw growth to 35.8 % in 2018 from 34.4% in 2017. The other expenditure that recorded a rise includes G&A expenses rising from 6.2% in 2017 to 6.6% in 2018. Increase in operating expenses reduces the net income, while a decrease in operating expenses increases the net income. Investors check the net income to determine the chances of getting dividends during a financial period.