JACK IN THE BOX to face referendum on minimum wage increase

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The newly proposed referendum seeks to block legislation that could raise the minimum wage for California fast food workers to as high as $22 per hour. The referendum, which would hit ballots in 2024, would let voters decide whether to permanently block the legislation, known as the FAST Recovery Act, or allow it to continue toward implementation. The challenge comes amid significant backlash against the FAST Recovery Act by groups representing the restaurant industry. If successful, the referendum could have a major impact on JACK IN THE BOX($NASDAQ:JACK)’s market and earnings in the long term.

Market Price

On Wednesday, shares of JACK IN THE BOX Inc opened at $73.80 and closed at $76.90, up by 4.1% from the previous closing price of $73.90. The company has not yet taken a position on the referendum.

VI Analysis

JACK IN THE BOX has an intermediate health score of 6/10 with regard to its cashflows and debt, is likely to safely ride out any crisis without the risk of bankruptcy. The company’s fundamentals reflect its long term potential and it is classified as ‘rhino’, a type of company that has achieved moderate revenue or earnings growth. JACK IN THE BOX is strong in dividend, profitability, medium in asset and weak in growth.

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Summary

This news caused many investors to believe that the company would eventually increase its prices in order to compensate for the higher wages, which would in turn lead to higher profits. The stock price may continue to rise in the future as more news about the referendum comes out.