Assessing Shake Shack: Insights From 13 Financial Analysts

13 analysts have shared their evaluations of Shake Shack SHAK during the recent three months, expressing a mix of bullish and bearish perspectives.

The following table encapsulates their recent ratings, offering a glimpse into the evolving sentiments over the past 30 days and comparing them to the preceding months.

The 12-month price targets, analyzed by analysts, offer insights with an average target of $140.31, a high estimate of $159.00, and a low estimate of $115.00. Observing a 8.0% increase, the current average has risen from the previous average price target of $129.92.

Understanding Analyst Ratings: A Comprehensive Breakdown

An in-depth analysis of recent analyst actions unveils how financial experts perceive Shake Shack. The following summary outlines key analysts, their recent evaluations, and adjustments to ratings and price targets.

Key Insights:

• Action Taken: Analysts respond to changes in market conditions and company performance, frequently updating their recommendations. Whether they 'Maintain', 'Raise' or 'Lower' their stance, it reflects their reaction to recent developments related to Shake Shack. This information offers a snapshot of how analysts perceive the current state of the company.
• Rating: Delving into assessments, analysts assign qualitative values, from 'Outperform' to 'Underperform'. These ratings communicate expectations for the relative performance of Shake Shack compared to the broader market.
• Price Targets: Delving into movements, analysts provide estimates for the future value of Shake Shack's stock. This analysis reveals shifts in analysts' expectations over time.

Assessing these analyst evaluations alongside crucial financial indicators can provide a comprehensive overview of Shake Shack's market position. Stay informed and make well-judged decisions with the assistance of our Ratings Table.

Stay up to date on Shake Shack analyst ratings.

Delving into Shake Shack's Background

Shake Shack Inc is a roadside burger stand. It is serving a classic American menu of premium burgers, hot dogs, crispy chicken, frozen custard, crinkle-cut fries, shakes, beer, wine and more. The company's burgers are made with a whole-muscle blend of all-natural, hormone and antibiotic-free Angus beef, ground fresh daily, cooked to order and served on a non-genetically modified organism (GMO) potato bun. Its menu focuses on food and beverages, crafted from a range of classic American foods. The company serves draft Root Beer, seasonal freshly-squeezed lemonade, organic fresh brewed iced tea, cold brew coffee, organic apple juice, and Shack20 bottled water.

Understanding the Numbers: Shake Shack's Finances

Market Capitalization Analysis: The company's market capitalization is below the industry average, suggesting that it is relatively smaller compared to peers. This could be due to various factors, including perceived growth potential or operational scale.

Revenue Growth: Over the 3 months period, Shake Shack showcased positive performance, achieving a revenue growth rate of 14.74% as of 30 September, 2024. This reflects a substantial increase in the company's top-line earnings. As compared to its peers, the company achieved a growth rate higher than the average among peers in Consumer Discretionary sector.

Net Margin: Shake Shack's net margin lags behind industry averages, suggesting challenges in maintaining strong profitability. With a net margin of -3.22%, the company may face hurdles in effective cost management.

Return on Equity (ROE): Shake Shack's ROE is below industry averages, indicating potential challenges in efficiently utilizing equity capital. With an ROE of -2.22%, the company may face hurdles in achieving optimal financial returns.

Return on Assets (ROA): Shake Shack's ROA lags behind industry averages, suggesting challenges in maximizing returns from its assets. With an ROA of -0.61%, the company may face hurdles in achieving optimal financial performance.

Debt Management: The company maintains a balanced debt approach with a debt-to-equity ratio below industry norms, standing at 1.76.

The Basics of Analyst Ratings

Benzinga tracks 150 analyst firms and reports on their stock expectations. Analysts typically arrive at their conclusions by predicting how much money a company will make in the future, usually the upcoming five years, and how risky or predictable that company's revenue streams are.

Analysts attend company conference calls and meetings, research company financial statements, and communicate with insiders to publish their ratings on stocks. Analysts typically rate each stock once per quarter or whenever the company has a major update.

Analysts may enhance their evaluations by incorporating forecasts for metrics like growth estimates, earnings, and revenue, delivering additional guidance to investors. It is vital to acknowledge that, although experts in stocks and sectors, analysts are human and express their opinions when providing insights.

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This article was generated by Benzinga's automated content engine and reviewed by an editor.