Cracker Barrel stock plunges amid brand makeover backlash
The fallout from Cracker Barrel's logo change and restaurant makeover isn't over. Shares of the food chain plunged Thursday as customer backlash and investor unease drove the chain’s worst losing streak in months.
Shares of Cracker Barrel (CBRL) tumbled more than 12% on Thursday, the steepest drop since April.
The stock, down 16.47%, is on pace for its worst five-day stretch since Feb. 14, when it dropped 17.7%. Cracker Barrel’s stock fell to $52, down more than $6, or about 11%, marking its lowest level since mid-June. Shares gained slightly to $53.48 by the afternoon.
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Since May, Cracker Barrel, beloved for its Southern comfort food, front-porch rocking chairs and gift shop filled with knickknacks and old-fashioned sweets, has embarked on a $700 million transformation across its 660-plus restaurants.
The sweeping makeover includes "decluttered" dining rooms, a revamped menu and other changes aimed at updating a brand long rooted in nostalgia.
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On Tuesday, the brand unveiled its new logo, which drops an illustration of a man resting his arm on top of a wooden barrel, a folksy image that has embodied the brand's southern hospitality for the last 56 years.
Cracker Barrel described the new logo as squarely anchored on the brand's "signature gold and brown tones" while incorporating "the iconic barrel shape and word mark that started it all," the company said in a statement.
The statement added that "farm fresh scrambled eggs and buttermilk biscuits" served as inspiration behind the "hues of a refreshed color palette."
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Critics say the rebrand is a risky move for a company already struggling with thin margins.
"Like Bud Light or New Coke, this is yet another example of how abandoning your brand and loyal customers is not the way to grow a business," Richard Stern, director of the Thomas A. Roe Institute for Economic Policy at The Heritage Foundation, told Fox News Digital.
Stern added that Cracker Barrel has consistently posted weak profit margins around 1.5%, "roughly a third of what you’d expect from a successful restaurant."
Stern argued that by chasing a new market, the restaurant chain has strayed from its roots.
"Their brand was partially the old-fashioned feel of an American general store, harkening to the pioneer west and the growth of rural highways," Stern added.
Fox News Digital's Landon Mion contributed to this report.