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Will Jack in the Box Meet 1Q16 Same-Store Sales Growth Guidance?

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Same-store sales growth

Same-store sales growth, expressed in percentage, is a measure of an increase in revenue from existing restaurants over a certain period. In this article, we will discuss Jack in the Box’s year-over-year same-store sales growth. We’ll discuss Qdoba’s same-store sales growth in the next article.

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1Q16 guidance and analyst estimates

On the back of 3.9% same-store sales growth from company-owned restaurants in 1Q15, the company has set 1Q16 guidance for Jack in the Box company-owned restaurants to be in the range of 1% to 3%. Analysts have estimated that the systemwide same-store sales growth will be 2.3% with company-owned restaurants expected to record same-store sales growth of 2.6% while the franchisees are expected to record growth of 3%.

The introduction of new menu items in 2015 helped the brand record positive same-store sales growth in all the quarters in 2015. Along with this, increased beverage offerings could have compelled the analysts to forecast positive same-store sales growth in 1Q16. Also, during the 4Q15 earnings call, the company stated that the brand recorded strong sales in the first five weeks of 1Q16.

1Q15 same-store sales growth

Earlier in 1Q15, the brand registered a systemwide same-store sales growth of 4.4%. The same-store sales growth was driven by positive sales across breakfast and late night offerings. During the same quarter, the brand’s company-owned restaurants’ same-store sales growth was 3.9% with 2.1% coming from an increase in menu prices, 1% from a better product mix, and 0.8% from higher traffic.

On January 25, McDonald’s (MCD) reported its 4Q15 earnings with positive same-store sales growth in all its division. You can read more about McDonald’s 4Q15 earnings in Lovin’ It: McDonald’s Posted Strong 4Q15 Earnings.

Alternatively, you can also gain exposure to JACK by investing in the iShares Russell 2000 Growth ETF (IWO), which invests 0.34% of its portfolio in JACK. IWO also invests 0.39% in Buffalo Wild Wings (BWLD) and 0.36% in Texas Roadhouse (TXRH).

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