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Jack in the Box (JACK) Q1 Earnings & Revenues Beat Estimates
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Jack in the Box Inc. (JACK - Free Report) reported solid first-quarter fiscal 2023 results, with earnings and revenues beating the Zacks Consensus Estimate. The top and the bottom line increased on a year-over-year basis. Following the results, the company’s shares rose 8.6% during trading hours on Mar 1.
Darin Harris, Jack in the Box’s chief executive officer, stated, "We are very pleased with our first quarter results, and enthusiastic about the momentum we are building for 2023 and our ongoing transformation story. Traffic improvement and robust comps, combined with anticipated positive net unit growth, position us to drive meaningful systemwide sales growth in 2023, and improve franchise profitability in an operating environment that remains challenging."
Earnings & Revenues Details
During the fiscal first quarter, adjusted earnings from continuing operations came in at $2.01 per share. The figure beat the Zacks Consensus Estimate of $1.76. The metric increased 2% from $1.97 reported in the prior-year quarter.
Quarterly revenues of $527.1 million beat the Zacks Consensus Estimate of $506 million by 4.1%. The top line rallied 52.9% on a year-over-year basis. Franchise rental revenues increased 5.6% year over year to $108.8 million. Franchise royalties and other revenues increased 25.7% year over year to $76.4 million. Franchise contributions to advertising and other services revenues rose 17.9% year over year to $71.7 million. Company restaurant sales during the quarter came in at $270.2 million compared with $120.1 million reported in the prior-year quarter.
Comps Discussion
In the quarter under review, comps at Jack in the Box’s stores increased 12.6% year over year against a decline of 0.3% reported in the prior-year quarter. The upside was primarily driven by growth in average checks and traffic.
Same-store sales at franchised stores increased 7.4% year over year compared with a 1.4% growth reported in the prior-year quarter. Systemwide same-store sales increased 7.8% year over year compared with a 1.2% increase reported in the year-ago quarter.
Del Taco Performance
During first-quarter fiscal 2023, same-store sales rose 3%, comprising franchise same-store sales growth of 2.8% and company-operated same-store sales growth of 3.1%. During the quarter, the company reported two franchise openings and one company-owned closure. It also announced development agreements for 16 new Del Taco restaurants (in California) and 10 new restaurants in North Tampa and Palm Beach, Florida.
Operating Highlights
During the fiscal first quarter, restaurant-level adjusted margin came in at 19.8% compared with 18.3% reported in the prior-year quarter. The upside was driven by strong sales leverage and a change in the mix of restaurants.
Food and packaging costs (as a percentage of company restaurant sales) fell 100 basis points (bps) year over year to 30.3%.
The franchise level margin was 44.4% in the fiscal first quarter compared with 41.6% reported in the prior-year quarter.
During the quarter, selling, general and administrative expenses accounted for 9.5% of total revenues compared with 7.3% reported in the prior-year quarter.
Balance Sheet
As of Jan 22, 2023, cash totaled $153.8 million compared with $108.9 million as of Oct 2, 2022. Inventories during the quarter came in at $5.1 million compared with $5.3 million as of Oct 2, 2022. Long-term debt (net of current maturities) totaled $1,793.4 million as of Jan 22, 2023, compared with $1,799.5 million at the end of Oct 2, 2022.
During the fiscal first quarter, the company repurchased nearly 0.2 million shares for an aggregate cost of $15 million. As of Jan 22, 2023, the company stated the availability of $160 million under its repurchase program.
The company declared a cash dividend of 44 cents per share. The dividend will be paid out on Mar 28, 2023, to shareholders on record as of Mar 15, 2023.
Chuy’s Holdings currently sports a Zacks Rank #1. CHUY has a trailing four-quarter earnings surprise of 19.1%, on average. Shares of CHUY have increased 15.2% in the past year.
The Zacks Consensus Estimate for Chuy’s Holdings 2023 sales and EPS suggests growth of 10.8% and 16.1%, respectively, from the corresponding year-ago period’s levels.
Arcos Dorados carries a Zacks Rank #2 (Buy). ARCO has a long-term earnings growth of 11.6%. Shares of the company have increased 6.1% in the past year.
The Zacks Consensus Estimate for Arcos Dorados’ 2023 sales and EPS suggests growth of 8.1% and 4.2%, respectively, from the year-ago period’s levels.
Brinker carries a Zacks Rank #2. EAT has a long-term earnings growth rate of 7.1%. The stock has declined 6.2% in the past year.
The Zacks Consensus Estimate for Brinker’s 2024 sales and EPS suggests growth of 3.9% and 36.5%, respectively, from the year-ago period’s reported levels.
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Jack in the Box (JACK) Q1 Earnings & Revenues Beat Estimates
Jack in the Box Inc. (JACK - Free Report) reported solid first-quarter fiscal 2023 results, with earnings and revenues beating the Zacks Consensus Estimate. The top and the bottom line increased on a year-over-year basis. Following the results, the company’s shares rose 8.6% during trading hours on Mar 1.
Darin Harris, Jack in the Box’s chief executive officer, stated, "We are very pleased with our first quarter results, and enthusiastic about the momentum we are building for 2023 and our ongoing transformation story. Traffic improvement and robust comps, combined with anticipated positive net unit growth, position us to drive meaningful systemwide sales growth in 2023, and improve franchise profitability in an operating environment that remains challenging."
Earnings & Revenues Details
During the fiscal first quarter, adjusted earnings from continuing operations came in at $2.01 per share. The figure beat the Zacks Consensus Estimate of $1.76. The metric increased 2% from $1.97 reported in the prior-year quarter.
Quarterly revenues of $527.1 million beat the Zacks Consensus Estimate of $506 million by 4.1%. The top line rallied 52.9% on a year-over-year basis. Franchise rental revenues increased 5.6% year over year to $108.8 million. Franchise royalties and other revenues increased 25.7% year over year to $76.4 million. Franchise contributions to advertising and other services revenues rose 17.9% year over year to $71.7 million. Company restaurant sales during the quarter came in at $270.2 million compared with $120.1 million reported in the prior-year quarter.
Comps Discussion
In the quarter under review, comps at Jack in the Box’s stores increased 12.6% year over year against a decline of 0.3% reported in the prior-year quarter. The upside was primarily driven by growth in average checks and traffic.
Same-store sales at franchised stores increased 7.4% year over year compared with a 1.4% growth reported in the prior-year quarter. Systemwide same-store sales increased 7.8% year over year compared with a 1.2% increase reported in the year-ago quarter.
Del Taco Performance
During first-quarter fiscal 2023, same-store sales rose 3%, comprising franchise same-store sales growth of 2.8% and company-operated same-store sales growth of 3.1%. During the quarter, the company reported two franchise openings and one company-owned closure. It also announced development agreements for 16 new Del Taco restaurants (in California) and 10 new restaurants in North Tampa and Palm Beach, Florida.
Operating Highlights
During the fiscal first quarter, restaurant-level adjusted margin came in at 19.8% compared with 18.3% reported in the prior-year quarter. The upside was driven by strong sales leverage and a change in the mix of restaurants.
Food and packaging costs (as a percentage of company restaurant sales) fell 100 basis points (bps) year over year to 30.3%.
The franchise level margin was 44.4% in the fiscal first quarter compared with 41.6% reported in the prior-year quarter.
During the quarter, selling, general and administrative expenses accounted for 9.5% of total revenues compared with 7.3% reported in the prior-year quarter.
Balance Sheet
As of Jan 22, 2023, cash totaled $153.8 million compared with $108.9 million as of Oct 2, 2022. Inventories during the quarter came in at $5.1 million compared with $5.3 million as of Oct 2, 2022. Long-term debt (net of current maturities) totaled $1,793.4 million as of Jan 22, 2023, compared with $1,799.5 million at the end of Oct 2, 2022.
During the fiscal first quarter, the company repurchased nearly 0.2 million shares for an aggregate cost of $15 million. As of Jan 22, 2023, the company stated the availability of $160 million under its repurchase program.
The company declared a cash dividend of 44 cents per share. The dividend will be paid out on Mar 28, 2023, to shareholders on record as of Mar 15, 2023.
Zacks Rank & Key Picks
Jack in the Box currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Some better-ranked stocks in the Zacks Retail – Restaurants industry are Chuy's Holdings, Inc. (CHUY - Free Report) , Arcos Dorados Holdings Inc. (ARCO - Free Report) and Brinker International, Inc. (EAT - Free Report) .
Chuy’s Holdings currently sports a Zacks Rank #1. CHUY has a trailing four-quarter earnings surprise of 19.1%, on average. Shares of CHUY have increased 15.2% in the past year.
The Zacks Consensus Estimate for Chuy’s Holdings 2023 sales and EPS suggests growth of 10.8% and 16.1%, respectively, from the corresponding year-ago period’s levels.
Arcos Dorados carries a Zacks Rank #2 (Buy). ARCO has a long-term earnings growth of 11.6%. Shares of the company have increased 6.1% in the past year.
The Zacks Consensus Estimate for Arcos Dorados’ 2023 sales and EPS suggests growth of 8.1% and 4.2%, respectively, from the year-ago period’s levels.
Brinker carries a Zacks Rank #2. EAT has a long-term earnings growth rate of 7.1%. The stock has declined 6.2% in the past year.
The Zacks Consensus Estimate for Brinker’s 2024 sales and EPS suggests growth of 3.9% and 36.5%, respectively, from the year-ago period’s reported levels.