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Jack In The Box Inc (JACK)
NASDAQ:JACK
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Jack In The Box
(NASDAQ:JACK)
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Rating:48Neutral
Price Target:
$21.00
▼(-4.59% Downside)
The score is held down primarily by weak financial performance (declining revenue, negative profitability) and a stressed balance sheet (negative equity and high leverage). The earnings call reinforces these near-term pressures despite debt-reduction actions. Technicals and the high dividend yield provide only partial support given loss-making results and ongoing margin compression.
Positive Factors
Non-core asset sale and debt paydown
The Del Taco divestiture and cash proceeds materially advance an asset-light strategy, providing immediate liquidity used for a $105M prepayment and enabling planned further paydowns. This structurally reduces leverage, frees capital for core brand investments, and lowers refinancing pressure over the medium term.
Technology modernization
A company-wide POS and back-of-house systems rollout is a durable upgrade that improves labor scheduling, inventory control and guest ordering. These systems support sustained margin improvement via labor and waste efficiencies and enable digital upsells and targeted marketing, lifting long-term unit economics.
Improving cash generation & strong franchise AUVs
Meaningful FCF growth plus relatively high franchise AUVs underpin the business's ability to self-fund capex and debt reduction. Asset-light franchise economics provide stable royalty streams and resilience versus company-operated volatility, supporting longer-term cash generation and deleveraging plans.
Negative Factors
Weak balance sheet and high leverage
Negative shareholders' equity and elevated leverage materially constrain financial flexibility, increasing refinancing, covenant and interest-rate risk. This structural weakness limits ability to invest in growth initiatives, raises probability of future dilutive actions, and prolongs recovery timelines absent sustained cash flow gains.
Demand and margin deterioration
Sustained negative comps and ~710bp restaurant-level margin compression reflect weaker transactions and cost inflation. Persistent sales declines and compressed unit margins undermine franchise royalties and company cash flow, making it harder to cover fixed costs and lengthening time needed to restore profitability.
Governance stress and activist pressure
Public activist campaigns and votes against directors create governance uncertainty, divert management focus, and can force strategic changes or board turnover. At a time when refinancing and turnaround execution are needed, such structural governance conflict raises execution risk and could delay consistent implementation.
Jack In The Box (JACK) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$407.66M
Dividend Yield9.34%
Average Volume (3M)478.48K
Price to Earnings (P/E)―
Beta (1Y)0.98
Revenue Growth-6.75%
EPS Growth-118.94%
CountryUS
Employees1,606
SectorConsumer Cyclical
Sector Strength84
IndustryRestaurants
Share Statistics
EPS (TTM)1.00
Shares Outstanding19,103,155
10 Day Avg. Volume479,086
30 Day Avg. Volume478,480
Financial Highlights & Ratios
PEG Ratio-0.04
Price to Book (P/B)-0.39
Price to Sales (P/S)0.25
P/FCF Ratio4.92
Enterprise Value/Market Cap8.56
Enterprise Value/Revenue2.38
Enterprise Value/Gross Profit8.22
Enterprise Value/Ebitda96.45
Forecast
1Y Price Target
$21.04Price Target Upside-4.43% Downside
Rating ConsensusHold
Number of Analyst Covering15
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
Jack In The Box Business Overview & Revenue Model
Company DescriptionJack in the Box Inc. operates and franchises Jack in the Box quick-service restaurants. As of November 23, 2021, it operated and franchised approximately 2,200 Jack in the Box quick-service restaurants in 21 states and Guam. The company was founded in 1951 and is headquartered in San Diego, California.
How the Company Makes MoneyJack In The Box generates revenue primarily through the sale of food and beverages at its restaurant locations. The company's revenue model is based on a mix of company-operated restaurants and franchised outlets, with franchise fees and royalties contributing to its earnings. Key revenue streams include sales from its menu items, which range from burgers and fries to salads and breakfast offerings. Additionally, promotional campaigns and limited-time menu items drive traffic to the restaurants, helping to boost sales. Partnerships with delivery services enhance accessibility and convenience for customers, further supporting revenue growth. The company's focus on value meals and combo deals also attracts price-sensitive consumers, contributing to overall profitability.
Jack In The Box Key Performance Indicators (KPIs)
Any
Revenue by Segment
Breaks down revenue streams by business segment, showing which parts of the company are growing and contributing most to overall sales.
Breaks down revenue streams by business segment, showing which parts of the company are growing and contributing most to overall sales.
Data provided by:
The Fly
The FlyJack In The Box Earnings Call Summary
Earnings Call Date:Feb 18, 2026
(Q1-2026)
| Next Earnings Date:May 20, 2026
Earnings Call Sentiment Negative
The call presented a mix of constructive strategic progress—most notably the completed Del Taco sale, an immediate debt prepayment, planned real estate monetization, marketing-driven early sales improvement, technology upgrades, and operational initiatives producing modest lifts—against material near-term operating and financial headwinds. Key operating metrics were weak in the quarter: same-store sales fell 6.7%, restaurant-level margins compressed sharply (to 16.1% from 23.2%), consolidated adjusted EBITDA and EPS declined meaningfully, and commodity and labor inflation pressured margins (food +380 bps; labor +200 bps). Leverage remains elevated (net debt/adj. EBITDA 6.5x) and refinancing needs are upcoming. Management reiterated prior guidance and emphasized that the improvements are early-stage and will take time to fully materialize.Q1-2026 Updates
Positive Updates
Completion of Del Taco Sale and Immediate Debt Reduction Actions
Closed sale of Del Taco on 12/22/2025 and used proceeds to make a $105 million partial prepayment on the August 2026 tranche. Total debt outstanding at quarter end was $1.6 billion and management reiterated plan to pay down an additional $200 million over the Jack on Track plan.
Planned Real Estate Monetization to Reduce Leverage
Generated $10.9 million of real estate proceeds in Q1 with associated gains of ~$6.3 million. Management expects $50–$60 million of real estate sale proceeds by the end of fiscal 2026 to be applied toward debt reduction.
Early Sales Momentum from 75th Anniversary Marketing
January/early-Q2 trends showed meaningful improvement vs Q1 (management said a couple hundred basis points better as Q2 began). Anniversary activations (Munchie Meals, Jibby collectible) drove higher average checks and trial, contributing to improved top-line trends when adjusting for weather.
Operational Improvements and 'Jack’s Way' Progress
Restructured field support and aligned restaurant training and audits to reinforce fundamentals. Mini refresh tests in ~20 restaurants delivered low single-digit sales lifts, and the company is expanding these efforts into Southern California.
Technology Modernization
Completed rollout of new POS and back-of-house systems (labor management and inventory) in late 2025. Q1 CapEx was $23.2 million (primarily IT), and management expects to leverage these systems for top-line upsells and bottom-line efficiencies.
Simplification and SG&A Reduction
Company simplified brands and marketing (reduced media messages from three to two) and continued to simplify operations. SG&A declined to $37.0 million (10.6% of revenues) from $41.2 million (11.1% prior year), driven by COLI market fluctuations and TSA income.
Franchisee Unit Economics and Local Benefits from Closures
Average Unit Volumes (AUVs) remain near ~$2.0 million for many franchisees. Franchisee closures (12 closed so far) have been associated with roughly a 30% sales benefit to nearby restaurants, according to management.
Negative Updates
Same-Store Sales Decline
Systemwide same-store sales decreased 6.7% in Q1: franchise same-store sales down 7.0% and company-owned same-store sales down 4.7%, driven by lower transactions and adverse sales mix (partially offset by menu price increases).
Significant Restaurant-Level Margin Compression
Restaurant-level margin declined to 16.1% in the quarter from 23.2% a year ago, a deterioration of ~710 basis points, reflecting higher costs and sales deleverage.
Rising Commodity and Labor Costs
Food and packaging costs rose to 29.7% of sales (+380 basis points year-over-year) with commodity inflation ~7.1% in the quarter and beef up double-digits. Labor increased to 35.3% of sales (+200 basis points), with elevated labor pressure in Chicago; occupancy and other costs rose +120 basis points.
Declines in Earnings and Adjusted EBITDA
Consolidated adjusted EBITDA fell to $68.2 million from $88.8 million a year ago (down $20.6 million). Earnings from continuing operations were $14.4 million vs $31.0 million prior year. GAAP diluted EPS from continuing operations was $0.75 vs $1.61, and adjusted operating EPS was $1.00 vs $1.86.
High Leverage and Upcoming Refinancing Needs
Net debt to adjusted EBITDA was 6.5x at quarter end (Del Taco excluded from the calculation). Management indicated it is assessing refinancing options for upcoming tranches and may be in the market in the coming months, exposing the company to market and interest rate risk.
Net Unit Decline and Impact on Franchise-Level Revenues
Q1 had 6 restaurant openings and 14 closures. The decrease in the number of restaurants contributed to lower rent and royalty revenue and reduced franchise-level margin ($84.1 million or 38.6% of franchise revenues vs $97.1 million or 40.9% the prior year).
One-Time/Extra Costs Including Proxy and Professional Fees
Other operating expenses, net, totaled $8.1 million and included proxy contest fees and professional fees for a tax refund settlement, partially offset by gains on real estate sales. Effective tax rate on continuing operations was 32.4% vs 30.0% prior year.
Company Guidance
Management reiterated the November 2025 guidance while emphasizing balance‑sheet repair and steady top‑line improvement: Q1 consolidated adjusted EBITDA was $68.2M (vs. $88.8M prior year), GAAP diluted EPS from continuing operations $0.75 (operating EPS $1.00), same‑store sales down 6.7% (franchise -7.0%, company -4.7%), restaurant‑level margin 16.1% (vs. 23.2%), food & packaging 29.7% (+380 bps) with commodity inflation +7.1% in Q1 (beef up double‑digits in Q1 but expected to moderate; full‑year commodity inflation guidance remains mid‑single digits), labor 35.3% (+200 bps), SG&A $37.0M (10.6% of revenues), Q1 capex $23.2M (≈$8M timing-related), total debt $1.6B with net debt/adjusted EBITDA of 6.5x (ex‑Del Taco), a $105M partial prepayment made in Q1 and a plan to pay down an additional $200M under Jack on Track, Q1 real‑estate proceeds $10.9M (gains ~$6.3M) with $50–60M expected by FY2026, TSA income ~$0.9M in Q1 (≤$2M expected for FY2026) with TSAs largely complete by end of Q2, and management noted potential refinancing of upcoming tranches.Jack In The Box Financial Statement Overview
Summary
Financials are weak overall: revenue is declining and profitability has turned negative (negative net income and negative EBIT/EBITDA margins). The balance sheet is a major risk with negative shareholders’ equity and high leverage/solvency concerns, partially offset by improved free cash flow growth.Income Statement
The income statement shows a declining trend in revenue with a negative growth rate of -1.55% in the most recent year. Gross profit margin and net profit margin have deteriorated significantly, with the company reporting negative net income. The EBIT and EBITDA margins have also turned negative, indicating operational challenges. Overall, the income statement reflects a struggling financial performance with declining profitability.45
Neutral
Balance Sheet
The balance sheet reveals a concerning financial structure with negative stockholders' equity, resulting in a negative debt-to-equity ratio. The return on equity is positive but low, indicating limited returns on shareholders' investments. The equity ratio is negative due to the negative equity, highlighting financial instability and potential solvency risks.30
Negative
Cash Flow
The cash flow statement shows some positive aspects, such as a significant growth in free cash flow by 50.21% in the latest period. However, the operating cash flow to net income ratio is low, indicating challenges in converting earnings into cash. The free cash flow to net income ratio is positive, suggesting some ability to generate cash despite negative net income.55
Neutral
| Breakdown | Sep 2025 | Sep 2024 | Sep 2023 | Sep 2022 | Sep 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 1.47B | 1.57B | 1.69B | 1.47B | 1.14B |
| Gross Profit | 419.92M | 462.98M | 508.14M | 433.31M | 411.60M |
| EBITDA | 36.19M | 138.29M | 336.80M | 304.07M | 337.16M |
| Net Income | -80.72M | -36.70M | 130.83M | 115.78M | 165.75M |
Balance Sheet | |||||
| Total Assets | 2.59B | 2.74B | 3.00B | 2.92B | 1.75B |
| Cash, Cash Equivalents and Short-Term Investments | 51.53M | 24.75M | 157.65M | 108.89M | 55.35M |
| Total Debt | 3.12B | 3.18B | 3.16B | 3.17B | 2.23B |
| Total Liabilities | 3.53B | 3.59B | 3.72B | 3.66B | 2.57B |
| Stockholders Equity | -938.27M | -851.80M | -718.33M | -736.19M | -817.88M |
Cash Flow | |||||
| Free Cash Flow | 74.14M | -46.66M | 140.05M | 116.41M | 160.11M |
| Operating Cash Flow | 162.36M | 68.82M | 215.01M | 162.88M | 201.12M |
| Investing Cash Flow | -74.69M | -69.37M | 42.22M | -578.59M | -20.93M |
| Financing Cash Flow | -60.03M | -131.19M | -207.36M | 478.18M | -343.55M |
Jack In The Box Technical Analysis
Positive
22.01
Price Trends
20.70
Positive
19.18
Positive
19.82
Positive
Market Momentum
0.06
Positive
51.74
Neutral
27.37
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JACK, the sentiment is Positive. The current price of 22.01 is above the 20-day moving average (MA) of 21.23, above the 50-day MA of 20.70, and above the 200-day MA of 19.82, indicating a bullish trend. The MACD of 0.06 indicates Positive momentum. The RSI at 51.74 is Neutral, neither overbought nor oversold. The STOCH value of 27.37 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JACK.
Jack In The Box Risk Analysis
Jack In The Box disclosed 35 risk factors in its most recent earnings report. Jack In The Box reported the most risks in the "Production" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 1 New Risks
1.
The pending sale of Del Taco may not be completed on the anticipated terms or timeline, or at all, and may involve risks and uncertainties that could adversely affect our business, financial condition, and results of operations. Q3, 2025
Jack In The Box Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
68 Neutral | $318.42M | 12.16 | 9.63% | ― | 2.09% | 12.10% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
57 Neutral | $1.03B | 27.63 | ― | 4.72% | -0.64% | -60.71% | |
57 Neutral | $1.33B | 8.24 | 87.63% | 8.15% | -0.21% | 0.16% | |
48 Neutral | $407.66M | -5.16 | ― | 9.34% | -6.75% | -118.94% | |
44 Neutral | $230.40M | -5.15 | -40.00% | ― | ― | ― |
* Consumer Cyclical Sector Average
JACK
Jack In The Box
22.01
-16.55
-42.92%
PZZA
Papa John's International
32.83
-14.02
-29.93%
WEN
Wendy's
8.18
-6.45
-44.08%
LOCO
El Pollo LoCo
10.72
-1.75
-14.03%
VENU
Venu Holding Corporation
5.60
-4.20
-42.86%
Jack In The Box Corporate Events
Business Operations and StrategyM&A Transactions
Jack in the Box Finalizes Sale of Del Taco Unit
Positive
Dec 23, 2025
On December 22, 2025, Jack in the Box Inc. completed the previously announced sale of its Del Taco Holdings Inc. subsidiary, which owns and operates the Del Taco restaurant brand, to Yadav Enterprises’ assignee Del Taco Group, LLC for approximately $119 million in cash consideration, subject to post-closing adjustments. The company received about $109 million in cash at closing and a 21-day, $10 million promissory note accruing 8% annual interest, guaranteed by Yadav founder and CEO Anil Yadav, marking a significant step in Jack in the Box’s “Jack on Track” plan to simplify its business model, reduce debt, and accelerate its shift toward a more asset-light, franchise-focused structure, with implications for a leaner balance sheet and a more concentrated focus on its core Jack in the Box brand.
The most recent analyst rating on (JACK) stock is a Hold with a $19.00 price target. To see the full list of analyst forecasts on Jack In The Box stock, see the JACK Stock Forecast page.
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.