Earnings Preview For Shake Shack

Shake Shack SHAK is preparing to release its quarterly earnings on Wednesday, 2024-10-30. Here's a brief overview of what investors should keep in mind before the announcement.

Analysts expect Shake Shack to report an earnings per share (EPS) of $0.19.

Investors in Shake Shack are eagerly awaiting the company's announcement, hoping for news of surpassing estimates and positive guidance for the next quarter.

It's worth noting for new investors that stock prices can be heavily influenced by future projections rather than just past performance.

Overview of Past Earnings

Last quarter the company missed EPS by $0.00, which was followed by a 5.84% drop in the share price the next day.

Here's a look at Shake Shack's past performance and the resulting price change:

Stock Performance

Shares of Shake Shack were trading at $114.26 as of October 28. Over the last 52-week period, shares are up 99.42%. Given that these returns are generally positive, long-term shareholders should be satisfied going into this earnings release.

Analysts' Perspectives on Shake Shack

For investors, grasping market sentiments and expectations in the industry is vital. This analysis explores the latest insights regarding Shake Shack.

A total of 16 analyst ratings have been received for Shake Shack, with the consensus rating being Neutral. The average one-year price target stands at $115.38, suggesting a potential 0.98% upside.

Comparing Ratings with Competitors

The following analysis focuses on the analyst ratings and average 1-year price targets of Sweetgreen, Wendy's and Dutch Bros, three prominent industry players, providing insights into their relative performance expectations and market positioning.

• The consensus outlook from analysts is an Buy trajectory for Sweetgreen, with an average 1-year price target of $37.78, indicating a potential 66.94% downside.
• The consensus among analysts is an Neutral trajectory for Wendy's, with an average 1-year price target of $19.49, indicating a potential 82.94% downside.
• Analysts currently favor an Buy trajectory for Dutch Bros, with an average 1-year price target of $40.56, suggesting a potential 64.5% downside.

Overview of Peer Analysis

Within the peer analysis summary, vital metrics for Sweetgreen, Wendy's and Dutch Bros are presented, shedding light on their respective standings within the industry and offering valuable insights into their market positions and comparative performance.

Key Takeaway:

Shake Shack ranks in the middle for revenue growth among its peers. It has the highest gross profit margin. However, its return on equity is below average compared to its peers. Overall, Shake Shack is positioned well in terms of financial performance when compared to its peers.

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.

Key Indicators: Shake Shack's Financial Health

Market Capitalization Analysis: Falling below industry benchmarks, the company's market capitalization reflects a reduced size compared to peers. This positioning may be influenced by factors such as growth expectations or operational capacity.

Revenue Growth: Over the 3 months period, Shake Shack showcased positive performance, achieving a revenue growth rate of 16.44% as of 30 June, 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 3.05%, the company may face hurdles in effective cost management.

Return on Equity (ROE): Shake Shack's ROE lags behind industry averages, suggesting challenges in maximizing returns on equity capital. With an ROE of 2.13%, the company may face hurdles in achieving optimal financial performance.

Return on Assets (ROA): The company's ROA is below industry benchmarks, signaling potential difficulties in efficiently utilizing assets. With an ROA of 0.59%, the company may need to address challenges in generating satisfactory returns from its assets.

Debt Management: Shake Shack's debt-to-equity ratio is below industry norms, indicating a sound financial structure with a ratio of 1.71.

To track all earnings releases for Shake Shack visit their earnings calendar on our site.

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