The slide in Cracker Barrel Old Country Store Inc.’s shares deepened on Thursday as a conservative backlash to the restaurant chain’s logo change intensified across social media.

Shares of the Southern-inspired casual dining operator, known for its homestyle cooking, fell as much as 15% as negative posts, including one from Donald Trump Jr. after the market close the prior session, flooded X. The notable drop follows Cracker Barrel’s announcement Tuesday that it would be removing the image of an old man leaning against a barrel from its logo, leaving just the words Cracker Barrel.

The stock pared losses to end the session down 7.2% — the fifth consecutive day of declines.

The protest is reminiscent of ones experienced by Anheuser-Busch InBev SA/NV and Target Corp. in 2023. A collaboration between Anheuser-Busch’s Bud Light brand and TikTok/Instagram transgender activist, and social influencer, Dylan Mulvaney, sent shares 20% lower in the first two months after the campaign. The social media revolt hurt sales of the beer for several months. Target, similarly faced pushback on its LGBTQ-themed merchandise and took a revenue hit.

In the case of Cracker Barrel, conservative critics saw the decision to remove the man, long known as Uncle Herschel, as an attempt by corporate executives to strip the chain of its history and character. That the CEO is a woman, Julie Felss Masino, only further fanned the outrage in some circles.

The “decision around the logo has been met with some resistance in a company that has a target audience that doesn’t take change well,” said David Wagner, portfolio manager at Aptus Capital Advisors LLC.

It took more than a year for shares of Anheuser-Busch to fully recover from the reaction to the Mulvaney partnership, which the beer maker backed away from after its launch. Target also pulled some of its merchandise ahead of Pride Month in 2023 after the company said its employees’ safety was at risk due to some threatening customers.

Bloomberg Intelligence senior analyst Michael Halen does not expect Lebanon, Tennessee-based Cracker Barrel to experience a prolonged, negative reaction. Worries that the “misinformation” on social media and concern that the posts will result in a situation similar to Bud Light are “unfounded,” according to his note.

Furthermore, he expects fiscal fourth-quarter same-stores sales growth will possibly top the consensus estimate of 3.5%. “Love or hate Cracker Barrel’s logo, sales may outperform,” Halen says.

Cracker Barrel will issue its results in mid-September. Analysts expect it to report its third straight year of annual declines in adjusted earnings per share, according to data compiled by Bloomberg.

Social media outrage

This isn’t the first time there was an uproar over a redesigned Cracker Barrel logo. In early 2021, a new logo sparked widespread debate on social media over whether it depicted a slaveholder’s whip.

The company responded at the time on social media saying the logo “does not depict and has never depicted a whip.” Cracker Barrel said it “rejects racism and discrimination in any form.”

This time around the removal of Uncle Herschel from the logo conjured criticism across the internet.

“This fifth evolution of the brand’s logo, which works across digital platforms as well as billboards and roadside signs, is a call-back to the original and rooted even more in the iconic barrel shape and word mark that started it all back in 1969,” Cracker Barrel said in an emailed statement.

Social media sentiment moving stocks has become more of a catalyst lately as it allows everyone to share opinions, according to Steve Sosnick of Interactive Brokers, who says Cracker Barrel is an “anti-meme” stock.

“The social media outrage is clearly resonating with a big piece of its customer base,” he added.

Earlier this month, American Eagle Outfitters Inc. shares jumped the most since 2000 after President Donald Trump touted the company’s ads featuring actress Sydney Sweeney as the “HOTTEST ad out there.”

“If Sydney Sweeney can get American Eagle Outfitters moving up because of a viral ad campaign, then why can’t a conservative backlash do the opposite to Cracker Barrel?” Sosnick said.

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