- Credit Suisse analyst Lauren Silberman reiterated an Underperform rating on the shares of Jack In The Box JACK and lowered the price target from $84 to $73.
- The analyst said the company demonstrated solid Q4 same-store sales, including Jack in the Box 4% & Del Taco 5.2%, while unit growth came in below expectations with a total of 29 net closures.
- JACK guided FY23 EPS to $5.25-5.65 (prior consensus $6.56), with the miss in part driven by an increase in tech investments.
- The company guided to positive net unit growth in FY23 (implies growth of <1%). While encouraged by the increase in the development pipeline, the analyst views the acceleration to ~4% by FY25 as a show-me story.
- The analyst believes current execution will be the near-term focus given challenges in the consumer environment, macro headwinds adding risk to unit growth, and noise around closures & Del Taco refranchising making it difficult to model the run-rate earnings power of the business.
- The analyst is looking for better visibility into the timing of a meaningful acceleration in unit growth and understanding of the long-term model before getting more constructive.
- JACK expects FY23 same-store sales in the Low Single Digit, supported by continued execution against its hook & build and barbell strategies, benefits from improvements in operating hours, further reopening of dining rooms and digital.
- Price Action: JACK shares are trading higher by 1.33% at $72.19 on the last check Wednesday.
- Photo Via Company
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Comments
Loading...
date | ticker | name | Price Target | Upside/Downside | Recommendation | Firm |
|---|
Benzinga simplifies the market for smarter investing
Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.
Join Now: Free!
Already a member?Sign in
