Shake Shack Stock Fair Value Calculation – Shake Shack Soars 17% in Q4 Revenue and Narrows Losses in 2023
February 20, 2023
Trending News 🌧️
Shake Shack ($NYSE:SHAK) had an impressive quarter in the fourth quarter of 2023, with a 17% increase in revenue and a narrowed loss. The total revenue for the quarter was $229.9 million, with Shack sales making up a large portion of the total at 96.7%. This surge in sales was driven by an increase in same-store sales throughout the quarter, as well as record-breaking performance in catering, delivery, and digital order channels. The company has used this strong Q4 as groundwork for further expansion plans for the upcoming year.
Additionally, the company is launching new initiatives to increase its digital presence, such as improved delivery services and better integration with third-party delivery applications. Shack Shack undoubtedly had a successful quarter and its 17% increase in revenue shows that the company is on the right track going into the future. As the company continues to grow, they will no doubt be able to build on their success and continue to provide customers with an enjoyable dining experience.
Price History
At the time of writing, most of the analysts and investors are largely positive about the upcoming prospects of the company. On Thursday, the stock opened at $57.8 and closed at $56.7, representing a 3.4% decrease from previous closing price of 58.7. Although the stock price saw minor volatility due to the news, many are still expecting the stock to recover and reach higher levels soon. Live Quote…
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Shake Shack. More…
| Total Revenues | Net Income | Net Margin |
| 900.49 | -24.09 | -2.5% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Shake Shack. More…
| Operations | Investing | Financing |
| 76.74 | -143.42 | -5.2 |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Shake Shack. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 1.49k | 1.08k | 10.27 |
Key Ratios Snapshot
Some of the financial key ratios for Shake Shack are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 14.8% | -1.0% | -2.5% |
| FCF Margin | ROE | ROA |
| -7.3% | -3.6% | -1.0% |
Analysis – Shake Shack Stock Fair Value Calculation
At GoodWhale, we have been delighted to analyze the fundamentals of SHAKE SHACK. After careful examination, we believe its fair value is close to $91.3, which was determined by our proprietary Valuation Line. Interestingly, SHAKE SHACK shares are currently being traded for around $56.7 — representing a bargain that is 37.9% lower than their true value. This opens up incredible opportunities for those looking to take advantage of the current price discrepancy. As an added bonus, SHAKE SHACK has reported strong financial performance despite the turbulence of the past few months. This means that the long-term returns should be healthy and well-supported by the company’s operations. More…
Peers
In the fast food industry, there is always stiff competition between the top companies. This is no different for Shake Shack Inc, a well-known American chain of hamburger restaurants. Some of their main competitors include BT Brands Inc, Doutor Nichires Holdings Co Ltd, and Kyochon Food&Beverage Co Ltd. While each company has its own unique selling points, they all share one common goal: to be the best in the industry.
– BT Brands Inc ($NASDAQ:BTBD)
PBT Brands Inc is a company that manufactures and sells a variety of products, including food, beverages, and health and beauty products. The company has a market cap of 12.92M as of 2022 and a return on equity of 2.15%. PBT Brands is a publicly traded company on the NASDAQ Stock Exchange.
– Doutor Nichires Holdings Co Ltd ($TSE:3087)
Doutor Nichires Holdings Co Ltd is a Japanese food and beverage company that operates a chain of coffee shops across Japan. As of 2022, the company had a market capitalization of $72.16 billion and a return on equity of 2.52%. The company’s coffee shops offer a range of coffee and tea beverages, as well as light meals such as sandwiches and salads.
– Kyochon Food&Beverage Co Ltd ($KOSE:339770)
Kyochon Food & Beverage Co Ltd is a South Korean company that specializes in chicken products. The company has a market cap of 248.33B as of 2022 and a return on equity of 11.08%. Kyochon was founded in 1991 and has since grown to become one of the largest chicken chains in South Korea. The company has over 1,000 outlets in South Korea and also has a presence in China, the Philippines, and the United States. Kyochon’s product offerings include chicken wings, drumsticks, and whole chickens. The company also offers a variety of side dishes and desserts.
Summary
Media coverage of the company has been mostly positive at the time of writing. Despite the impressive financial performance, the stock price has moved down; this could be attributed to general market sentiment or investors shifting away from casual dining and fast-food stocks. Nonetheless, Shake Shack has strong fundamentals and a solid brand presence that should help it recover and build onto the positive momentum from the last quarter. With quality menu items that meet the demands of a changing consumer base and a focus on modernizing and digitizing its business, Shake Shack is set for long-term success and could be a meaningful addition to investors’ portfolios.
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