Jack-in-the-Box Stock Rose after Fiscal 2Q17 Earnings Announcement



Fiscal 2Q17 performance

Jack in the Box (JACK) posted its fiscal 2Q17[1. fiscal 2Q17 ended April 16, 2017] earnings after the market closed on May 16, 2017. The company operates the Jack in the Box food chain and Qdoba Mexican Eats, a Mexican-style fast-casual restaurant chain.

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Stock performance

Jack in the Box (JACK) posted adjusted earnings per share (or EPS) of $0.98 on revenues of $369.4 million. Analysts were expecting the company to post EPS of $0.91 on revenues of $369.2 million.

During the earnings call, the company’s management stated that its valuation had been negatively impacted by having two different business models. To enhance shareholder value, it retained Morgan Stanley (MS) to evaluate potential alternatives for Qdoba.

In the recent quarter, Qdoba had been a drag on the company’s top line. So, the news of the board considering alternatives for Qdoba has increased investors’ confidence, leading to a rise in its stock price. On May 18, 2017, JACK traded at $104.02, which represents 2.1% growth since the announcement of its fiscal 2Q17 earnings.

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Year-to-date performance

Since the beginning of 2017, Jack in the Box stock has fallen 6.8%. During the same period, its peers McDonald’s (MCD), Wendy’s (WEN), and Restaurant Brands International (QSR) have returned 20.8%, 17.7%, and 24.1%, respectively.

Respectively, the S&P 500 INDEX (SPX) and the Consumer Discretionary Select Sector SPDR ETF (XLY) have returned 5.7% and 8.9%, year-to-date.

Series overview

In this series, we’ll look at Jack in the Box’s (JACK) fiscal 2Q17 performance, earnings call, and notes. We’ll also cover the company’s management guidance for 2017 and analysts’ estimates for the next four quarters. We’ll wrap up the series by looking at the company’s valuation multiple and analysts’ recommendations.

First, we’ll look at JACK’s fiscal 2Q17 revenues.


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