Cracker Barrel has been the target of an activist investor, Biglari Holdings ( BH), a publicly traded company that is the capital allocation vehicle of hedge fund manager Sardar Biglari. Biglari Holdings has amassed a 17.5% stake in Cracker Barrel, and has been seeking changes at the company and representation on the company's board of directors. Specifically, Biglari points to declining operating income per store, and believes that it could be much higher. He's also been displeased about the lack of transparency regarding performance of the retail business, which leads me to believe there's skepticism about devoting so much space to retail. (There's also a Web site, enchancecrackerbarrel.com, devoted to the cause, which contains letters sent to Cracker Barrel shareholders, and management.)
The fight is not over yet either; like many activist situations, it is escalating. Biglari originally wanted one seat on the board. Now he wants four. He's also the largest shareholder and just 2.5% away from triggering the poison pill. Stay tuned. At the time of publication, the author was long BH. This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.