Wolterk/iStock Editorial via Getty Images
Wolterk/iStock Editorial via Getty Images
Jack In The Box (NASDAQ:JACK ) shares slid sharply after the restaurant chain revealed disappointing earnings and expectations on Thursday.
The San Diego-based fast food chain reported EPS of $1.16, missing analyst estimates by $0.21. Meanwhile, revenue of $322.29M came up $18.52M short of the analyst consensus. Additionally, same-store sales fell 0.8% in the second quarter while analysts had expected a positive jump.
Omicron hangovers were blamed in part for the sliding sales, while CEO Darrin Harris added that “continued inflationary pressure” facing the restaurant industry tempered profitability and will likely continue to curtail more optimistic projections.
In light of this commentary, it was unsurprising to see full year forecasts came up short of analyst consensus. Company-wide operating EPS is now expected to fall between $5.80 to $6.10 versus a consensus of $6.65. The company also updated wage and commodity price expectations to reflect inflationary pressures.
Shares fell nearly 5% in midday trading on Thursday.
“We are disappointed by 2Q's same store sales, margins and EBITDA miss that included a 5.5 week contribution of TACO EBITDA vs our and consensus estimates for standalone JACK EBITDA,” Cowen analyst Andrew Charles wrote to clients on Thursday, noting the magnitude of misses on key metrics.
While he maintained his “Buy” rating on the stock, he indicated that the stock is near the low-end of his “conviction list” after showing it is “not immune from industry sales and margin pressure”.
Read more on M&A rumors related to Jack in the Box.