Stock performance

Shake Shack (SHAK) posted its fourth-quarter earnings after the market closed on February 25. Before looking at analysts’ reactions, we’ll look at Shake Shack’s fourth-quarter performance and stock performance.

Why Shake Shack Stock Rose after Fourth-Quarter Earnings

For the fourth quarter, Shake Shack posted adjusted EPS of $0.06 on revenues of $124.3 million outperforming analysts’ EPS expectation of $0.03 and revenue estimate of $118.8 million. Also, the company’s SSSG (same-store sales growth) of 2.3% beat analysts’ expectation of a decline in SSSG of 1.2%.

After posting its fourth-quarter earnings, Shake Shack’s management provided SSSG guidance for 2019. Management expects its 2019 SSSG in the range of 0%–1%, which accounts for a 1.5% increase in the company’s menu prices in December. The weak 2019 sales outlook appears to have caused the company’s stock price to fall to a low of $49.54 on February 26. However, the stock recovered later in the day to close at $52.47, which represents a rise of 0.4% from its previous day’s closing price.

For a more detailed analysis of Shake Shack’s fourth-quarter performance, check out Shake Shack’s Q4 Earnings Didn’t Impress Investors.

Year-to-date performance

Year-to-date, Shake Shack has returned 15.5% as of February 26. Peers Chipotle Mexican Grill (CMG) and McDonald’s (MCD) have returned 38.8% and 3.2%, respectively. The broader comparative index, the Consumer Discretionary Select Sector SPDR ETF (XLY)—which invests 8.3% of its holdings in restaurants—has returned 12.0%.

Next in this series, we’ll look at analysts’ reactions after Shake Shack’s fourth-quarter earnings.

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