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Janus Henderson Sustainable & Impact Core Bond ETF (JACK) - free report >>
Bear of the Day: Jack in the Box Inc. (JACK)
Jack in the Box Inc. (JACK - Free Report) offered disappointing guidance when it reported its fourth quarter and full-year 2024 results on November 20. The fast-food company pointed to a “difficult top-line macro environment” as part of the reason for its lackluster showing.
Jack in the Box shares have tumbled 40% in the last year, highlighting a rough decade compared to the market and its industry.
Jack in the Box Stock 101
Jack in the Box operates and franchises Jack in the Box, one of the biggest hamburger chains in the U.S., with around 2,200 restaurants across 23 states. The company’s portfolio also includes Del Taco, which boasts approximately 597 restaurants across 17 states.
The San Diego, California-headquartered company’s sales slumped 7% in fiscal 2024 (period ended on September 29). Same-store sales fell 2.1% in Q4 for Jack in the Box, driven by a decrease in transactions and an unfavorable menu mix. Meanwhile, Del Taco’s same-store sales decreased 3.9% in the fourth quarter.
Image Source: Zacks Investment Research
Looking ahead, Jack in the Box’s overall revenue is projected to drop by 2.5% in FY25 to $1.53 billion. More importantly, its adjusted earnings are projected to decline by 11% to $5.52 a share. Jack in the Box’s FY25 earnings estimate has tumbled 17% since its Q4 release, with its FY26 outlook 21% lower.
Jack in the Box’s downward earnings revisions help it earn a Zacks Rank #5 (Strong Sell). Wall Street is also lukewarm on JACK, with 13 of our 21 brokerage recommendations at a “Hold.”
Image Source: Zacks Investment Research
Time to Stay Away from JACK Stock?
Jack in the Box stock has fallen 40% in the past 10 years while its Retail sector has climbed 180% and its Restaurants industry has surged 135%. JACK’s 40% decline in the last year looks even worse next to its industry’s 12% jump and the S&P 500’s 32% surge.
JACK is trading below its 200-month moving average for only the second time ever (the other was during the initial Covid selloff). Even though Jack in the Box opened 30 restaurant openings in FY 2024, marking “the highest openings since 2012,” it might be best to stay away from the stock until it proves a turnaround is close.