JACK - Embedded Expectations Analysis - 2018 02 06
ï€ Jack in the Box Inc. (JACK:USA) currently trades at recent highs relative toUAFRS-based (Uniform) Earnings, with a 27.4x Uniform P/E, implying bullish expectations for the firm. However, management has concerns about industry trends, franchising, and their initiatives
ï€ Specifically, management may be exaggerating the industry shift towards chicken, and may be concerned about decreases in franchise growth over the next couple of years. Furthermore, they may be concerned about consumers lacking brand loyalty below certain price points, and may also be concerned about the extent of their tech initiatives
Jack in the Box operates and franchises Jack in the Box? quick-service restaurants (QSRs). Jack in the Box restaurants provide a selection of products including burgers like its Jumbo Jack? and product lines such as Buttery Jack? burgers. The company also provides breakfast sandwiches with cracked eggs, tacos and curly fries, along with sandwiches, salads and real ice cream shakes, among other items. The company allows its guests to customize their meals and order any product, including breakfast items any time of the day (or night). The company operates and franchises Jack in the Box QSRs, primarily in the western and southern United States, including in Guam.
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