NasdaqGS:JACK

Stock Analysis Report

Executive Summary

Jack in the Box Inc. operates and franchises Jack in the Box quick-service restaurants.

Rewards

Trading at 31% below its fair value

Earnings are forecast to grow 7.22% per year

Risk Analysis

Debt is not well covered by operating cash flow

Unstable dividend track record

Large one-off items impacting financial results



Snowflake Analysis

Second-rate dividend payer and slightly overvalued.


Similar Companies

Share Price & News

How has Jack in the Box's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: JACK has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-0.09%

JACK

0.09%

US Hospitality

0.5%

US Market


1 Year Return

12.0%

JACK

6.7%

US Hospitality

20.3%

US Market

Return vs Industry: JACK exceeded the US Hospitality industry which returned 6.7% over the past year.

Return vs Market: JACK underperformed the US Market which returned 20.3% over the past year.


Shareholder returns

JACKIndustryMarket
7 Day-0.09%0.09%0.5%
30 Day8.7%-1.9%2.0%
90 Day14.1%7.4%9.4%
1 Year14.3%12.0%9.5%6.7%22.8%20.3%
3 Year-3.1%-8.2%37.0%27.9%50.1%40.4%
5 Year-1.9%-9.6%48.5%32.8%73.1%54.1%

Price Volatility Vs. Market

How volatile is Jack in the Box's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Jack in the Box undervalued compared to its fair value and its price relative to the market?

31.0%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: JACK ($88.76) is trading below our estimate of fair value ($128.73)

Significantly Below Fair Value: JACK is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: JACK is poor value based on its PE Ratio (25x) compared to the Hospitality industry average (24.3x).

PE vs Market: JACK is poor value based on its PE Ratio (25x) compared to the US market (18.3x).


Price to Earnings Growth Ratio

PEG Ratio: JACK is poor value based on its PEG Ratio (3.5x)


Price to Book Ratio

PB vs Industry: JACK has negative assets, so we can't compare its PB Ratio to the US Hospitality industry average.


Next Steps

Future Growth

How is Jack in the Box forecast to perform in the next 1 to 3 years based on estimates from 17 analysts?

7.2%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: JACK's forecast earnings growth (7.2% per year) is above the savings rate (1.7%).

Earnings vs Market: JACK's earnings (7.2% per year) are forecast to grow slower than the US market (14.2% per year).

High Growth Earnings: JACK's earnings are forecast to grow, but not significantly.

Revenue vs Market: JACK's revenue (2.4% per year) is forecast to grow slower than the US market (7.6% per year).

High Growth Revenue: JACK's revenue (2.4% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: Insufficient data to determine if JACK's Return on Equity is forecast to be high in 3 years time


Next Steps

Past Performance

How has Jack in the Box performed over the past 5 years?

0.4%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: JACK has a large one-off loss of $32.3M impacting its September 29 2019 financial results.

Growing Profit Margin: JACK's current net profit margins (9.7%) are lower than last year (12%).


Past Earnings Growth Analysis

Earnings Trend: JACK's earnings have grown by 0.4% per year over the past 5 years.

Accelerating Growth: JACK's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: JACK had negative earnings growth (-12.2%) over the past year, making it difficult to compare to the Hospitality industry average (-9.8%).


Return on Equity

High ROE: JACK's liabilities exceed its assets, so it is difficult to calculate its Return on Equity.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Jack in the Box's financial position?


Financial Position Analysis

Short Term Liabilities: JACK has negative shareholder equity, which is a more serious situation than short term assets not covering short term liabilities.

Long Term Liabilities: JACK has negative shareholder equity, which is a more serious situation than short term assets not covering long term liabilities.


Debt to Equity History and Analysis

Debt Level: JACK has negative shareholder equity, which is a more serious situation than a high debt level.

Reducing Debt: JACK's has negative shareholder equity, so we do not need to check if its debt has reduced over time.

Debt Coverage: JACK's debt is not well covered by operating cash flow (13.2%).

Interest Coverage: JACK's interest payments on its debt are well covered by EBIT (3.5x coverage).


Balance Sheet

Inventory Level: JACK has a high level of physical assets or inventory.

Debt Coverage by Assets: JACK has negative shareholder equity (liabilities exceed assets) therefore debt is not covered by short term assets.


Next Steps

Dividend

What is Jack in the Box's current dividend yield, its reliability and sustainability?

1.80%

Current Dividend Yield


Dividend Yield vs Market

company1.8%marketbottom25%1.4%markettop25%3.7%industryaverage3.0%forecastin3Years2.1%

Current dividend yield vs market & industry

Notable Dividend: JACK's dividend (1.8%) is higher than the bottom 25% of dividend payers in the US market (1.44%).

High Dividend: JACK's dividend (1.8%) is low compared to the top 25% of dividend payers in the US market (3.73%).


Stability and Growth of Payments

Stable Dividend: Whilst dividend payments have been stable, JACK has been paying a dividend for less than 10 years.

Growing Dividend: JACK's dividend payments have increased, but the company has only paid a dividend for 6 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (45%), JACK's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: JACK's dividends in 3 years are forecast to be well covered by earnings (37.9% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

2.0yrs

Average management tenure


CEO

Lenny Comma (49yo)

6.1yrs

Tenure

US$6,202,069

Compensation

Mr. Leonard A. Comma, also known as Lenny, serves as the Chairman of Jack in the Box Inc., and serves as its Chief Executive Officer since January 1, 2014. He served as Chairman of Jack in the Box Inc. sin ...


CEO Compensation Analysis

Compensation vs Market: Lenny's total compensation ($USD6.20M) is above average for companies of similar size in the US market ($USD3.82M).

Compensation vs Earnings: Lenny's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Leonard Comma
Chairman & CEO6.1yrsUS$6.20m0.20% $4.0m
Lance Tucker
Executive VP & CFO1.9yrsUS$2.78m0.015% $303.9k
Marcus Tom
Senior VP & COO2yrsUS$1.07m0.0041% $83.6k
Phillip Rudolph
Executive VP12.3yrsUS$2.06m0.20% $4.0m
Drew Martin
Senior VP & Chief Information Officer3.3yrsno data0.0058% $118.2k
Rachel Webb
Vice President of Investor Relations & Strategic Analysis0yrsno datano data
Melissa Corrigan
Senior VP & Chief Human Resources Officer1.3yrsno data0.023% $466.4k
Dean Gordon
Senior VP & Chief Supply Chain Officer2.6yrsno data0.032% $656.8k
Adrienne Ingoldt
Senior VP0.08yrsno data0.0051% $104.7k
Jennifer Kennedy
Senior VP0.08yrsno data0.0051% $104.7k

2.0yrs

Average Tenure

54yo

Average Age

Experienced Management: JACK's management team is considered experienced (2 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Leonard Comma
Chairman & CEO6.1yrsUS$6.20m0.20% $4.0m
James Myers
Independent Director9.2yrsUS$195.85k0.025% $518.7k
David Tehle
Independent Director15.2yrsUS$240.90k0.019% $397.4k
Madeleine Kleiner
Independent Director8.4yrsUS$182.00k0.028% $582.0k
David Goebel
Lead Independent Director0yrsUS$198.88k0.037% $756.6k
Michael Murphy
Independent Director17.4yrsUS$254.81kno data
Jean Birch
Independent Director0.8yrsUS$125.63kno data
John Wyatt
Independent Director9.8yrsUS$191.83k0.026% $536.5k
Sharon John
Independent Director5.4yrsUS$170.44k0.011% $216.0k
Man Yeung
Independent Director2.8yrsUS$174.05kno data

8.4yrs

Average Tenure

61yo

Average Age

Experienced Board: JACK's board of directors are considered experienced (8.4 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: JACK insiders have only sold shares in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Jack in the Box Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Jack in the Box Inc.
  • Ticker: JACK
  • Exchange: NasdaqGS
  • Founded: 1951
  • Industry: Restaurants
  • Sector: Consumer Services
  • Market Cap: US$2.049b
  • Shares outstanding: 23.09m
  • Website: https://www.jackinthebox.com

Number of Employees


Location

  • Jack in the Box Inc.
  • 9330 Balboa Avenue
  • San Diego
  • California
  • 92123
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
JACKNasdaqGS (Nasdaq Global Select)YesCommon StockUSUSDMar 1992
JBXDB (Deutsche Boerse AG)YesCommon StockDEEURMar 1992

Biography

Jack in the Box Inc. operates and franchises Jack in the Box quick-service restaurants. As of September 29, 2019, it operated and franchised approximately 2,243 Jack in the Box restaurants in 21 states and Guam. The company was founded in 1951 and is based in San Diego, California. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/20 01:32
End of Day Share Price2020/02/19 00:00
Earnings2019/09/29
Annual Earnings2019/09/29


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.