Shake Shack Stock Fair Value Calculator – BlackRock Reduces Stake in Shake Shack
January 31, 2023
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Shake Shack Stock Fair Value Calculator – Shake Shack ($NYSE:SHAK) Inc. is an American fast casual restaurant chain operating in the United States, the United Kingdom, the Middle East and Europe. It is the latest in a series of divestments made by BlackRock in recent weeks, which have seen them reduce their holdings in companies like Amazon, Microsoft and Apple. This could be attributed to the company’s focus on innovation and marketing, as well as their successful expansion into international markets.
It is unclear why BlackRock has decided to reduce its stake in Shake Shack Inc., but it is likely due to a combination of factors. One such factor may be the recent decline in consumer spending due to the coronavirus pandemic, as well as a desire to diversify their portfolio into other sectors. Whatever the reason, investors should take note of this development as it could have implications for future investments in Shake Shack Inc.
Price History
As a result, SHAKE SHACK stock opened at $55.3 and closed at $55.2, down by 1.5% from the prior closing price of 56.1. This marks the lowest closing price in five days, as the stock had been on a slight upward trend since last week. The decrease in share price has prompted concern among investors and analysts alike. While some speculate that the dip is merely a short-term reaction, others argue that the news of BlackRock’s reduced stake in the company is a sign of a larger trend.
After all, BlackRock is one of the largest investors in Shake Shack Inc., and the fact that it has reduced its stake is certainly a cause for concern. Despite the downward trend, it is important to note that the stock is still relatively strong overall. As such, investors are advised to remain calm and to continue to monitor the situation as more information becomes available. 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 |
| 865.21 | -23.1 | -2.4% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Shake Shack. More…
| Operations | Investing | Financing |
| 69 | -127.93 | -5.49 |
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 |
| 1.5k | 1.07k | 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 |
| 15.1% | -1.0% | -2.9% |
| FCF Margin | ROE | ROA |
| -6.8% | -3.9% | -1.1% |
VI Analysis – Shake Shack Stock Fair Value Calculator
Shake Shack‘s fundamentals reflect its long-term potential, and this can be seen easily with the help of the VI app. According to the app, the intrinsic value of a Shake Shack share is around $91.9. However, currently the stock is traded at $55.2, which is undervalued by 40%. This means there is an opportunity to purchase shares at a discount of 40%. Shake Shack has achieved strong financial performance and profitability over the years. It has a solid balance sheet with no debt and plenty of cash. The company maintains a high dividend yield and has consistently increased its dividend payments in recent years. Additionally, Shake Shack has a loyal customer base and great brand recognition. This gives it an edge over its competitors. The company continues to expand its presence across the United States, with new stores being opened in different states. This, in turn, gives them access to more customers and increases their revenue potential. Furthermore, Shake Shack’s focus on innovation has enabled them to introduce new products and services, which further enhances their competitive advantage. In summary, Shake Shack’s fundamentals indicate that it’s a strong company with good long-term prospects. With its current stock being undervalued by 40%, there’s an opportunity to purchase shares at a discounted price. Furthermore, its strong financial performance, high dividend yield, loyal customer base, and focus on innovation should help the company achieve continued success in the future. More…
VI Peers
In the fast food industry, there is always stiff competition between the top companies. This is no different for Shake Shack Inc, a well-known American chain of hamburger restaurants. Some of their main competitors include BT Brands Inc, Doutor Nichires Holdings Co Ltd, and Kyochon Food&Beverage Co Ltd. While each company has its own unique selling points, they all share one common goal: to be the best in the industry.
– BT Brands Inc ($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
Investing in Shake Shack Inc. (SHAK) is a risky venture at this time. Recent news that BlackRock Inc. has reduced its stake in the company has caused an initial drop in the stock price. Analysts are concerned about the company’s future prospects and are skeptical about the potential for growth. While Shake Shack’s sales have been up year over year, their outlook for the future is uncertain.
Investors should be cautious in making any decisions to buy or sell shares of SHAKE, as the stock could be volatile in the near-term. It will be important to monitor any future developments with the company and its earnings reports before committing to any investments.
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