Cracker Barrel (CBRL) shares surge 8.39% on activist stake boost

Cracker Barrel Old Country Store (NASDAQ:CBRL) shares surged 8.3875% in pre-market trading on January 16, 2026, signaling renewed investor confidence in the restaurant chain.

The rally followed activist investor Sardar Biglari’s increased stake in the company, with his firm, Biglari Holdings Inc., adding 50,100 shares to push his ownership above 16.3%. This move coincided with a 17.43% rise in short interest, as traders betting against the stock faced upward pressure to cover positions. The combination of institutional support and short covering amplified the stock’s momentum.

Cracker Barrel’s volatility reflects ongoing market skepticism about its recovery. Despite a 35.2% year-to-date gain, the stock remains 49.5% below its 2025 high, pressured by a contentious 2025 rebranding that sparked customer backlash and a sharp selloff. However, analysts note improving fundamentals, including Bernstein’s outlook for a 2026 sector rebound driven by tax reforms and the U.S. Soccer World Cup. Restaurant valuations at decade lows also suggest potential upside if consumer spending stabilizes.

Looking ahead, nine analysts project 48% annual earnings growth over the next three years, outpacing the market’s 12% forecast. While the stock’s elevated P/E ratio of 44.7x highlights optimism about future earnings, investors remain cautious about near-term risks, including inflationary pressures and shifting dining trends.