Shake Shack (SHAK) AI Stock Analysis

• Market Cap: $4.35B
• Dividend Yield: N/A
• Average Volume (3M): 1.59M
• Price to Earnings (P/E): 219.4
• Beta (1Y): 1.31
• Revenue Growth: 13.13%
• EPS Growth: -25.05%
• Country: US
• Employees: 12,826
• Sector: Consumer Cyclical
• Sector Strength: 83
• Industry: Restaurants
• EPS (TTM): 0.44
• Shares Outstanding: 40,247,757
• 10 Day Avg. Volume: 1,080,957
• 30 Day Avg. Volume: 1,590,376
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.41
• Enterprise Value/Revenue: 4.78
• Enterprise Value/Gross Profit: 15.18
• Enterprise Value/Ebitda: 49.02
• 1Y Price Target: $133.88
• Price Target Upside: 33.64% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 18

• Rating: 66 Neutral
• Price Target: $121.00 ▲(20.78% Upside)

Shake Shack's overall stock score is driven by strong financial performance and a positive earnings call, indicating effective growth strategies and operational improvements. However, technical analysis shows bearish momentum, and the high P/E ratio suggests overvaluation, which tempers the overall score.

Positive Factors

Comparable Sales

Momentum continued with a 3.2% comparable sales increase in July, exceeding full-quarter consensus expectations.

Financial Performance

Shake Shack's second-quarter EPS rose 60%, well above estimates, reflecting significant financial performance improvement.

Marketing Initiatives

The company recently launched its first paid media campaign and expects the incremental investment to boost brand awareness and engagement.

Negative Factors

Guidance and Forecasts

Lowering 2025E same store sales to 1.5% from 2.1%.

Investor Expectations

Results did not meet high investor expectations with shares trading near peak valuation over the last 3 years.

Stock Valuation

SHAK is trading at a high valuation compared to its historical average, which may limit future stock upside.

Shake Shack Business Overview & Revenue Model

Company Description

Shake Shack (SHAK) is a fast-casual restaurant chain primarily focused on serving high-quality burgers, hot dogs, crinkle-cut fries, and hand-spun shakes. Founded in 2004 in New York City, the company operates in the food and beverage sector, emphasizing premium ingredients and a vibrant dining experience. Shake Shack has expanded its footprint globally, catering to a diverse customer base while promoting a commitment to sustainability and community engagement.

How the Company Makes Money

Shake Shack generates revenue primarily through the sale of food and beverage items at its company-operated and franchised locations. The company's core revenue streams include direct sales from its restaurants, which offer a limited but appealing menu that emphasizes quality and freshness. Additionally, Shake Shack earns revenue through franchising agreements, where franchisees pay initial fees and ongoing royalties based on sales. The company has also engaged in partnerships with various food delivery services to expand its reach, allowing customers to order online and increasing sales through delivery channels. Furthermore, Shake Shack occasionally launches limited-time menu items and promotions that drive customer interest and boost revenue during specific periods.

Shake Shack Financial Statement Overview

Summary

Shake Shack exhibits strong growth dynamics and effective cash flow management. Revenue growth and gross margins are commendable, but net profitability and leverage require attention. The balance sheet is stable, but the company could benefit from enhancing its return on equity.

Income Statement

Shake Shack has shown consistent revenue growth, with a TTM (Trailing-Twelve-Months) revenue increase of 2.43% compared to the previous annual period. The gross profit margin remains strong at 44.95%, indicating effective cost management. However, net profit margins are relatively low at 0.97%, suggesting pressure on profitability. The EBIT margin is modest at 0.85%, but the EBITDA margin of 9.60% reflects better operational efficiency. Overall, the income statement shows healthy growth but with tight profitability margins.

Balance Sheet

Shake Shack's balance sheet reflects a stable equity position with an equity ratio of 27.40%, indicating a balanced approach to financing assets. The debt-to-equity ratio stands at 1.73, which is manageable yet signals a moderate level of leverage. Return on equity (ROE) is low at 2.62%, pointing to challenges in generating substantial returns for shareholders. The balance sheet is stable but indicates room for improvement in profitability and leverage management.

Cash Flow

The company has demonstrated strong cash flow management, with an operating cash flow to net income ratio of 13.83, highlighting robust cash generation capabilities. Free cash flow has shown positive growth, increasing by 11.94% in the TTM period, reflecting effective control over capital expenditures. The free cash flow to net income ratio is 3.22, indicating efficient cash utilization. Overall, the cash flow statement shows excellent cash generation and reinvestment strategies.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.28B	1.25B	1.09B	900.49M	739.89M	522.87M
Gross Profit	404.22M	573.92M	398.39M	381.54M	306.52M	212.72M
EBITDA	125.18M	120.89M	111.74M	51.53M	44.48M	5.58M
Net Income	12.41M	10.21M	20.26M	-25.97M	-10.11M	-45.53M
Balance Sheet
Total Assets	1.73B	1.70B	1.61B	1.49B	1.46B	1.15B
Cash, Cash Equivalents and Short-Term Investments	312.92M	320.71M	293.21M	311.23M	302.41M	183.76M
Total Debt	834.63M	809.62M	771.33M	714.05M	686.19M	384.98M
Total Liabilities	1.23B	1.20B	1.14B	1.08B	1.02B	710.86M
Stockholders Equity	473.32M	470.02M	443.42M	395.12M	435.60M	407.32M
Cash Flow
Free Cash Flow	39.91M	35.66M	-14.03M	-65.82M	-43.09M	-31.69M
Operating Cash Flow	171.71M	171.16M	132.14M	76.74M	58.40M	37.35M
Investing Cash Flow	-106.74M	-66.08M	-132.32M	-143.42M	-144.89M	-69.40M
Financing Cash Flow	-12.26M	-9.02M	-5.68M	-5.20M	242.02M	141.82M

Shake Shack Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 100.18
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SHAK, the sentiment is Negative. The current price of 100.18 is below the 20-day moving average (MA) of 105.04, below the 50-day MA of 122.14, and below the 200-day MA of 114.91, indicating a bearish trend. The MACD of -4.84 indicates Negative momentum. The RSI at 30.79 is Neutral, neither overbought nor oversold. The STOCH value of 28.85 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SHAK.

Shake Shack Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PBPB	72 Outperform	$382.19M	35.48	19.65%	―	-1.72%	-70.31%
NATH	71 Outperform	$431.73M	17.80	-102.54%	1.89%	6.38%	9.98%
CAVA	67 Neutral	$7.65B	55.56	20.90%	―	28.21%	227.11%
SHAK	66 Neutral	$4.35B	219.41	4.16%	―	13.13%	-25.05%
WEN	63 Neutral	$1.94B	10.61	99.35%	7.55%	1.31%	-1.46%
Sector *	61 Neutral	$17.97B	12.87	-5.30%	2.97%	1.26%	-14.45%
JACK	51 Neutral	$366.70M	―	4.15%	8.61%	-6.66%	-71.87%

Shake Shack Corporate Events

Shake Shack Reports Strong Q2 2025 Financial Results

On July 31, 2025, Shake Shack announced its financial results for the second quarter of 2025, reporting a total revenue of $356.5 million, a 12.6% increase from 2024. The company also reported an operating income of $22.4 million, a significant rise from $10.8 million in 2024, and a net income of $18.5 million. Shake Shack opened 13 new company-operated Shacks, including two drive-thrus, and nine new licensed Shacks, enhancing its market presence and operational growth.

The most recent analyst rating on (SHAK) stock is a Sell with a $120.00 price target. To see the full list of analyst forecasts on Shake Shack stock, see the SHAK Stock Forecast page.

Shake Shack Stockholders Vote on Key Proposals

At its annual meeting on June 4, 2025, Shake Shack Inc. stockholders voted on three key proposals. They elected Daniel Meyer, Jeff Flug, and Lori George as Class I directors to serve until 2028, ratified Ernst & Young LLP as the independent public accounting firm for 2025, and approved the compensation of named executive officers, indicating strong shareholder support for the company’s leadership and financial oversight.

The most recent analyst rating on (SHAK) stock is a Hold with a $123.00 price target. To see the full list of analyst forecasts on Shake Shack stock, see the SHAK Stock Forecast page.