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The Zacks Analyst Blog Highlights: Jack in the Box, Apollo Global, McDonald and Papa John
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For Immediate Release
Chicago, IL –December 3, 2018 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Jack in the Box Inc. (JACK - Free Report) , Apollo Global Management (APO - Free Report) , McDonald (MCD - Free Report) and Papa John (PZZA - Free Report) .
Here are highlights from Friday’s Analyst Blog:
Jack in the Box Shares Jump on Potential Sellout Buzz
Shares of Jack in the Box Inc. have surged nearly 6% on Nov 29, following the buzz of a potential sellout of the company. Per Reuters, this hamburger restaurant chain, with more than 2,000 restaurants, is looking for options that may include the sale of the company.
Although there is no certainty about any potential deal, rumors are that the company has started to look for potential buyers, including private equity firms. Notably, in March 2018, Jack in the Box sold its subsidiary Qdoba to Apollo Global Management.
Why is the Sellout a Dire Need of the Hour?
Jack in the Box has been facing the brunt of declining sales for quite some time now. Despite selling its Qdoba subsidiary, the company could not overcome hurdles of soft comps and operational inefficiencies.
In the fourth quarter of fiscal 2018, Jack in the Box saw its overall revenue decline 23.5% year over year. Moreover, the company mentioned that it began first-quarter fiscal 2019 on a disappointing note. Comps for the first seven weeks of the fiscal first quarter decreased 1-2% due to Ribeye Burger’s dismal performance. For fiscal 2019, the company expects comps to be in the range of flat to up 2%.
Further, the company is plagued with competition from high-end fast food chains. While several other restaurateurs, including McDonald’s, have opened their outlets in the emerging markets, Jack in the Box has a limited international presence. Moreover, the company is experiencing increased competitive pressure on breakfast and lunch day parts as many other restaurateurs introduced aggressive value offers.
Bottom-Line
If the deal materializes, it will be the latest among a plethora of buyout deals that the fast food sector is witnessing this year. Earlier, the drive-in burger chain Sonic made a merger deal with Inspire Brands for about $1.57 billion. Pizza giant Papa John’s has also been looking for ways to sell the company.
In a highly competitive industry, all restaurant chains are supposed to make pragmatic use of advanced technologies and innovate across value chains. Jack in the Box seems to be slightly slow in this front as is reflected in its dismal sales performance and share price movement. Hence, a potential sellout could be in the cards for the company.
Notably, shares of Jack in the Box have declined 15.8% over the past year, underperforming the industry’s rally of 11.3%.
Jack in the Box currently carries a Zacks Rank #5 (Strong Sell).
The greatest discovery in this century of biology is now at the flashpoint between theory and realization. Billions of dollars in research have poured into it. Companies are already generating revenue, and cures for a variety of deadly diseases are in the pipeline.
So are big potential profits for early investors. Zacks has released an updated Special Report that explains this breakthrough and names the best 3 stocks to ride it.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit http://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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The Zacks Analyst Blog Highlights: Jack in the Box, Apollo Global, McDonald and Papa John
For Immediate Release
Chicago, IL –December 3, 2018 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Jack in the Box Inc. (JACK - Free Report) , Apollo Global Management (APO - Free Report) , McDonald (MCD - Free Report) and Papa John (PZZA - Free Report) .
Here are highlights from Friday’s Analyst Blog:
Jack in the Box Shares Jump on Potential Sellout Buzz
Shares of Jack in the Box Inc. have surged nearly 6% on Nov 29, following the buzz of a potential sellout of the company. Per Reuters, this hamburger restaurant chain, with more than 2,000 restaurants, is looking for options that may include the sale of the company.
Although there is no certainty about any potential deal, rumors are that the company has started to look for potential buyers, including private equity firms. Notably, in March 2018, Jack in the Box sold its subsidiary Qdoba to Apollo Global Management.
Why is the Sellout a Dire Need of the Hour?
Jack in the Box has been facing the brunt of declining sales for quite some time now. Despite selling its Qdoba subsidiary, the company could not overcome hurdles of soft comps and operational inefficiencies.
In the fourth quarter of fiscal 2018, Jack in the Box saw its overall revenue decline 23.5% year over year. Moreover, the company mentioned that it began first-quarter fiscal 2019 on a disappointing note. Comps for the first seven weeks of the fiscal first quarter decreased 1-2% due to Ribeye Burger’s dismal performance. For fiscal 2019, the company expects comps to be in the range of flat to up 2%.
Further, the company is plagued with competition from high-end fast food chains. While several other restaurateurs, including McDonald’s, have opened their outlets in the emerging markets, Jack in the Box has a limited international presence. Moreover, the company is experiencing increased competitive pressure on breakfast and lunch day parts as many other restaurateurs introduced aggressive value offers.
Bottom-Line
If the deal materializes, it will be the latest among a plethora of buyout deals that the fast food sector is witnessing this year. Earlier, the drive-in burger chain Sonic made a merger deal with Inspire Brands for about $1.57 billion. Pizza giant Papa John’s has also been looking for ways to sell the company.
In a highly competitive industry, all restaurant chains are supposed to make pragmatic use of advanced technologies and innovate across value chains. Jack in the Box seems to be slightly slow in this front as is reflected in its dismal sales performance and share price movement. Hence, a potential sellout could be in the cards for the company.
Notably, shares of Jack in the Box have declined 15.8% over the past year, underperforming the industry’s rally of 11.3%.
Jack in the Box currently carries a Zacks Rank #5 (Strong Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
3 Medical Stocks to Buy Now
The greatest discovery in this century of biology is now at the flashpoint between theory and realization. Billions of dollars in research have poured into it. Companies are already generating revenue, and cures for a variety of deadly diseases are in the pipeline.
So are big potential profits for early investors. Zacks has released an updated Special Report that explains this breakthrough and names the best 3 stocks to ride it.
See them today for free >>
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit http://www.zacks.com/performance for information about the performance numbers displayed in this press release.