- Shake Shack’s preliminary 4Q revenue reached $328.7 million, slightly surpassing the estimate of $325.7 million.
- Preliminary Shack sales were $316.6 million, compared to the estimated $314.3 million.
- Licensing revenue in the preliminary report was $12.1 million, exceeding the estimate of $11.7 million.
- The year-end revenue forecast is set between $1.45 billion and $1.48 billion, above the estimate of $1.43 billion.
- Expected licensing revenue for the year ranges between $49.0 million and $51.0 million.
- Adjusted EBITDA is projected to be between $200.0 million and $210.0 million, close to the estimate of $206.7 million.
- Restaurant level operating margins are anticipated at 22%, slightly higher than the estimated 21.8%.
- Shake Shack plans approximately 45 new company-operated openings.
- They anticipate opening 35 to 40 new licensed Shack locations.
- The company’s operational target was updated to feature at least 1,500 Shacks overall.
- Restaurant-level profit margin is expected to be about 22.7% of Shack sales in Q4 2024 and approximately 21.4% for the fiscal year 2024.
- For FY2025, Shake Shack aims for a total revenue growth of 16%-18% year-over-year.
- They expect to expand their restaurant margins to about 22%.
- Adjusted EBITDA growth is projected between 14% and 20% compared to FY2024.
- As per recent evaluations, Shake Shack has 11 buy recommendations, 13 holds, and 1 sell rating from analysts.
Shake Shack Inc Class A on Smartkarma
Analyst coverage of Shake Shack Inc Class A on Smartkarma reveals contrasting sentiments from top independent researchers. Baptista Research, in their report “Shake Shack Inc.: Can Its Expansion of Drive-Thru & Operational Efficiency Up Their Game? – Major Drivers,” highlights the company’s strong financial performance in the third quarter of 2024, with positive trends and cautionary notes. The solid 15th consecutive quarter of positive same-Shack sales growth and heightened restaurant-level margins led to a significant 28% rise in adjusted EBITDA to $45.8 million.
On the contrary, Value Investors Club, in their report “Shake Shack Inc (SHAK) – Friday, Aug 30, 2024,” leans bearish on the stock, recommending shorting due to declining traffic, comp growth, and high stock price valuations. Despite challenges, including potential commoditization of its unique offerings and lack of activist investor involvement, Shake Shack faces uncertainties in maintaining growth sustainability. This dichotomy in analyst sentiment underscores the complexities and varied perspectives surrounding Shake Shack Inc’s performance and future outlook.
A look at Shake Shack Inc Class A Smart Scores
| Factor | Score | Magnitude |
|---|---|---|
| Value | 2 | |
| Dividend | 1 | |
| Growth | 4 | |
| Resilience | 2 | |
| Momentum | 5 | |
| OVERALL SMART SCORE | 2.8 |
Smart Score is a compound score for the Company indicating its overall outlook. It is derived by taking an equally weighted average of underlying Factor scores computed by Smartkarma
Shake Shack Inc Class A, a renowned “roadside” burger stand, is part of the esteemed Union Square Hospitality Group. According to the Smartkarma Smart Scores, the company demonstrates strong growth potential and momentum in the market. With a Growth score of 4 and a Momentum score of 5, Shake Shack Inc Class A seems to be on a promising trajectory for the long term.
However, the company’s Value score of 2 and Resilience score of 2 indicate some areas that may need attention. Shake Shack Inc Class A may need to focus on enhancing its intrinsic value and building resilience to withstand potential market challenges. Notably, the low Dividend score of 1 suggests that the company may not be prioritizing dividend payouts to investors at the moment. Overall, investors may find Shake Shack Inc Class A an appealing growth opportunity with strong market momentum.
Disclaimer: This article by Smartkarma is general in nature and based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Note that our articles may not factor in the latest price-sensitive company announcements or qualitative material.
While all reasonable care has been taken in the preparation, Smartkarma makes no assurance about the accuracy of any generated data or content. All content is indicative only and should be independently checked for accuracy and confirmed before use. Smartkarma accepts no responsibility for any loss or damage caused as a result of any inaccuracy or error within the Lab online tools or generated data.
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