Shake Shack Q3 Earnings & Revenues Beat Estimates, Stock Up

Shake Shack Inc. SHAK posted third-quarter fiscal 2024 results, wherein both earnings and revenues beat their respective Zacks Consensus Estimate. The top and bottom lines also increased on a year-over-year basis. Following the results, the company’s shares moved up 10% during today’s pre-market trading session.In the quarter, the company ramped up its investment in marketing strategies and programs aimed at increasing guest engagement and brand awareness, even amid a challenging market environment. These efforts have paid off, as the company has achieved some of the highest brand awareness levels on record, which, in turn, is fueling robust sales and profitability growth.SHAK’s Earnings & Revenue DetailsSHAK’s fiscal third-quarter adjusted earnings per share (EPS) came in at 25 cents, which beat the Zacks Consensus Estimate of 20 cents. In the prior-year quarter, the company reported adjusted EPS of 17 cents.Quarterly revenues of $316.9 million beat the consensus mark of $315 million. The top line increased 14.7% on a year-over-year basis.Same-Shack sales increased 4.4% year over year compared with 4% growth in the previous quarter. Our estimate for the metric was 2%.Shack sales rose 15.1% year over year to $304.9 million. We expected the metric to be $302.6 million.Licensing revenues increased 7.1% year over year to $12 million. We anticipated the metric to be $11.9 million. Shack system-wide sales rose 12.8% year over year to $495.1 million.Shake Shack, Inc. Price, Consensus and EPS Surprise Shake Shack, Inc. price-consensus-eps-surprise-chart | Shake Shack, Inc. QuoteOperating Highlights of SHAKIn the quarter, operating loss came in at $18 million against a gain of $5.7 million reported in the prior-year quarter. Restaurant-level profit margin was 21%, up 60 basis points (bps) year over year.In the fiscal third quarter, food and paper costs (as percentages of company revenues) contracted 90 bps year over year to 28.2%. Labor and related costs (as percentages of company revenues) contracted 80 bps year over year to 28%.Total expenses in the quarter came in at $334.9 million compared with $270.6 million reported in the prior-year quarter. Our estimate for the metric was $306.5 million.Adjusted EBITDA in the reported quarter amounted to $45.8 million compared with $35.8 million reported in the year-ago quarter. Adjusted EBITDA margin expanded 140 bps year over year to 14.4%.Balance Sheet of SHAKAs of Sept. 25, 2024, cash and cash equivalents totaled $310.9 million compared with $224.7 million as of Dec. 27, 2023. Total long-term debt at the end of the fiscal third quarter came in at $246.4 million from $245.6 million as of Dec. 27, 2023.SHAK’s Q4 & Fiscal 2024 OutlookFor fourth-quarter fiscal 2024, the company expects total revenues to be between $322.6 million and $327 million. Licensing revenues are projected in the range of $11.6-$12 million. The company anticipates fiscal fourth quarter Restaurant-level profit margin to be nearly 22%.For the fiscal 2024, the company expects revenues to be $1.25 billion. Licensing revenues are projected in the range of $44.6-$45 million compared with the previous expectation of $44-$45 million. Restaurant-level profit margins are projected to reach 21% compared with the previous projection of 20.6-21%. The company expects Adjusted EBITDA in the range of $168-$170 million.The company expects approximately 45 company-operated openings in the fiscal 2024. It also anticipates approximately 35-40 licensed Shack openings at the same time.Zacks Rank of SHAKShake Shack currently carries a Zacks Rank #2 (Buy).Other Stocks to ConsiderSome other top-ranked stocks in the Zacks Retail – Restaurants industry are:CAVA Group, Inc. CAVA sports a Zacks Rank of 1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.CAVA has a trailing four-quarter earnings surprise of 257.7%, on average. The stock has surged 336.8% in the past year. The Zacks Consensus Estimate for CAVA’s 2024 sales and EPS indicates a rise of 29.1% and 104.8%, respectively, from the year-ago period’s levels.Boot Barn Holdings, Inc. BOOT sports a Zacks Rank of 1. BOOT has a trailing four-quarter earnings surprise of 6.8%, on average. The stock has risen 86.2% in the past year.The consensus estimate for BOOT’s fiscal 2025 sales and EPS indicates growth of 12.1% and 10.9%, respectively, from the year-ago period’s levels.Abercrombie & Fitch Co. ANF presently carries a Zacks Rank #2.ANF has a trailing four-quarter earnings surprise of 28%, on average. The stock has surged 127.7% in the past year. The Zacks Consensus Estimate for ANF’s fiscal 2024 sales and EPS indicates growth of 13% and 63.4%, respectively, from the year-ago period’s levels.Zacks Names #1 Semiconductor StockIt's only 1/9,000th the size of NVIDIA which skyrocketed more than +800% since we recommended it. NVIDIA is still strong, but our new top chip stock has much more room to boom.With strong earnings growth and an expanding customer base, it's positioned to feed the rampant demand for Artificial Intelligence, Machine Learning, and Internet of Things. Global semiconductor manufacturing is projected to explode from $452 billion in 2021 to $803 billion by 2028.See This Stock Now for Free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Abercrombie & Fitch Company (ANF): Free Stock Analysis Report Boot Barn Holdings, Inc. (BOOT): Free Stock Analysis Report Shake Shack, Inc. (SHAK): Free Stock Analysis Report CAVA Group, Inc. (CAVA): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks