NEW YORK - Shake Shack Inc . (NYSE: NYSE:SHAK), now valued at $5.46 billion, today announced its ambitious long-term goal to increase its company-operated footprint to at least 1,500 locations. This update marks a significant leap from its initial target of 450 outlets set during its February 2015 IPO. The company also reported preliminary unaudited results for the fiscal fourth quarter and year ended December 25, 2024, showcasing a 48% year-over-year growth in Adjusted EBITDA. According to InvestingPro data, the stock has delivered an impressive 94.89% return over the past year, though current valuations suggest the stock may be trading above its Fair Value.
Shake Shack's CEO, Rob Lynch, emphasized the company's journey of spreading "Enlightened Hospitality" and noted the end of FY2024 with 329 company-operated Shacks. The company's CFO, Katie Fogertey, outlined a positive outlook for FY2025, projecting a Total (EPA:TTEF) revenue growth of 16% - 18% year-over-year and an Adjusted EBITDA increase of 14% - 20% compared to FY2024. InvestingPro analysis reveals the company maintains a healthy financial position with a current ratio of 2.01, indicating strong liquidity to support its expansion plans. InvestingPro subscribers have access to 14 additional key insights about SHAK's financial health and growth prospects.
The fourth quarter of FY2024 saw a 4.3% increase in same-Shack sales and a notable 14.8% rise in Total revenue. The restaurant-level profit margin reached 22.7%, the highest for a fourth quarter since 2017. For the fiscal year, Shake Shack opened a record 43 company-operated Shacks and 33 licensed Shacks.
Looking forward, the company's initial guidance for FY2025 suggests Total revenue between $1.45 billion and $1.48 billion, with licensing revenue expected to be in the range of $49.0 million to $51.0 million. Same-Shack sales are anticipated to grow by approximately 3%, and restaurant-level profit margin is projected to be around 22.0%. The company also plans to open approximately 45 new company-operated Shacks and 35 to 40 licensed Shacks.
These financial targets reflect Shake Shack's strategy for aggressive growth and market expansion. The company's presentation at the 27th Annual ICR Conference will further elaborate on these plans and the company's strategic priorities.
The information in this article is based on a press release statement from Shake Shack Inc. and provides a glimpse into the company's performance and future plans, as it aims to strengthen its presence in the restaurant industry.
In other recent news, Shake Shack has been the subject of several analyst reports. Raymond (NS:RYMD) James reiterated an Outperform rating on Shake Shack, forecasting approximately 25% year-over-year EBITDA growth and significant margin improvement. The firm expects Shake Shack to revise its long-term total addressable market estimates, suggesting a potential to triple or quadruple its current U.S. store count. For 2025, Raymond James predicts Shake Shack will continue to outperform in comparable sales and see margin expansion, driven by increased advertising efforts, a refined limited-time offer strategy, and ongoing promotions.
Barclays (LON:BARC), on the other hand, raised Shake Shack's stock rating and target to $159, forecasting revenue growth of 16.38% and expecting both companies to guide comparable store sales growth in the low single-digit-plus range. Truist Securities maintained a Buy rating on Shake Shack, with a steady price target of $147.00. The firm has lowered its adjusted EBITDA expectations for 2024, attributing this to pre-opening expenses. However, the estimate for 2025 has been increased based on the assumption that the company's development guidance for 2025 remains intact.
Finally, Truist Securities updated its outlook on Shake Shack, increasing the price target to $147 from $144 while maintaining a Buy rating on the stock. The analyst cited an expected beat in store openings for 2024, with two more stores than initially planned, and highlighted the rapid expansion in California following the third-quarter closures in 2024. This expansion strategy aligns with the company's strong revenue growth of 16.4% over the last twelve months.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.