What Happened?
Shares of fast-food chain Jack in the Box (NASDAQ: JACK) fell 4.6% in the afternoon session after multiple Wall Street analysts lowered their price targets on the stock. The negative sentiment from Wall Street follows price target reductions from several financial firms. While maintaining their ratings, analysts adjusted their outlooks. TD Cowen lowered its target from $25 to $21, and RBC Capital cut its target to $22 from $30. Similarly, Truist Securities and Barclays both reduced their price targets to $19. Oppenheimer also made a significant adjustment, lowering its target from $44 to $28. These widespread reductions from multiple analysts suggest a more cautious view on the company's near-term stock performance, even though the underlying 'buy' or 'hold' ratings were unchanged.
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What Is The Market Telling Us
Jack in the Box’s shares are extremely volatile and have had 37 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 3 days ago when the stock dropped 3.6% after the stock continued to pull back as the company reported second-quarter 2025 financial results that missed revenue expectations, alongside a significant drop in same-store sales. For the second quarter, the fast-food chain's revenue declined 9.8% year on year to $333 million, falling short of Wall Street's estimate of $340 million. While its earnings per share of $1.15 met analyst expectations, other key metrics pointed to underlying weakness. A significant area of concern for investors was a steep 7.1% year-on-year decline in same-store sales, a key indicator of a restaurant's performance, which worsened from a 2.5% decline in the same quarter last year. Furthermore, the company's adjusted EBITDA of $61.63 million also missed the consensus estimate of $64.59 million. Overall, the weaker-than-expected revenue and sharp drop in customer demand at existing locations overshadowed the in-line earnings, raising concerns about the company's outlook.
Jack in the Box is down 56.1% since the beginning of the year, and at $17.99 per share, it is trading 65.7% below its 52-week high of $52.42 from August 2024. Investors who bought $1,000 worth of Jack in the Box’s shares 5 years ago would now be looking at an investment worth $216.36.
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