UPDATE: Bank of America Merrill Lynch Upgrades Cracker Barrel Old Country Store to Neutral Based on Strong Restaurant Sales

In a report published on Thursday, Bank of America Merrill Lynch analyst Joseph Buckley upgraded restaurant chain Cracker Barrel Old Country Store CBRL from underperform to Neutral with an updated price target of $99, citing recent sales growth in a tough economic environment and plans to repurchase a 20 percent stake from Sardar Biglari as reasons for the upgrade. In the report, Buckley pointed out, "We had previously viewed Sardar Biglari's almost 20% stake in CBRL as a negative overhang given two failed attempts by the activist investor to gain board seats. But CBRL's offer earlier this year to repurchase his stake flipped this potential negative into a possible highly accretive positive. Low interest rates and the recent expiration of an expensive swap that significantly reduces CBRL interest expense make the potential repurchase more easily affordable and limit related balance sheet risk." Cracker Barrel closed on Wednesday at $87.69.