Shake Shack stock bolted Thursday after the burger and milkshake chain posted a major profit jump for its Q2 results. It was the latest move in a broader rebound among ailing restaurants stocks.
Shake Shack reported a 50% increase in earnings to 27 cents per share adjusted, matching FactSet estimates. Total revenue surged 16.4% to $316.5 million to beat forecasts of $314.4 million.
Operating income more than doubled to $10.8 million from $4.7 million last year.
Same store sales rose 4%, ahead of views of 3.2% growth. Shake Shack reported that systemwide sales grew 13.5% from last year.
During the second quarter, Shake Shack opened 12 new company-operated locations, three of which are drive-thrus. That brings the total company-operated openings to 18 so far this year, with two new locations opened in Q3 so far.
Shake Shack said its performance in the first half of the year puts it on track to reach its 2024 targets. The New York-based chain guided expectations for a full-year revenue increase of 14% to 15%, to range from $1.24 billion to $1.25 billion. Shake Shack also expects to achieve positive free cash flow on the year for the first time since 2017.
Shake Shack Stock Joins Restaurant Rebound
SHAK stock spiked 16.9% Thursday to jump well above its 50-day moving average and break a downtrend stretching back to early May.
The stock's May 6 peak of 111.29 marked its highest price since June 2021.
SHAK shares are up 38% this year.
Among other restaurant stocks, Chipotle Mexican Grill jumped about 7.3% off lows for the week through Thursday. Papa Johns International rallied nearly 8% in that period. Sweet Green, Starbucks, First Watch and Cava Group also scored notable gains.
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