Company Overview
Jack in the Box Inc. develops, operates, and franchises quick-service restaurants across the United States through its distinct Jack in the Box and Del Taco segments. Operating within the Consumer Cyclical sector and specifically the Restaurants industry, the company functions as a provider of fast-food services where demand fluctuates with consumer spending power and economic cycles. The entity employs 1,316 individuals and holds a total market capitalization of $185.30M, while generating annual revenue of $1.44B over the trailing twelve-month period. These valuation and revenue figures indicate a mid-sized market position, suggesting the company operates with a significant but not dominant market share relative to larger peer groups in the quick-service dining space.
Financial Health
The company reported revenue of $1.44B for the trailing twelve months, yet posted a net income of -$97,326,000, a disparity that reveals a substantial cost structure where expenses significantly outpace gross profitability. Despite the reported net loss, the firm maintains an EBITDA of $242.03M, highlighting the importance of non-cash items or capital expenditure adjustments in assessing operational cash generation before financing costs. However, the free cash flow stands at -$25,618,750, indicating that the company is currently spending more on operations and capital expenditures than it is generating from cash flows, which limits immediate financial flexibility for expansion without external financing. Margin analysis shows a gross margin of 27.5%, an operating margin of 14.4%, and a negative profit margin of -8.1%, illustrating that while core operations retain a portion of sales revenue, high overhead costs or one-time charges are eroding the final bottom line. The balance sheet presents a complex picture with cash holdings of $71.97M contrasted against total debt of $2.63B, and the debt-to-equity ratio is listed as N/A due to the lack of positive equity in the standard calculation context. This heavy debt load relative to cash reserves suggests a highly leveraged financial structure that relies on future cash flow generation to service obligations. Liquidity is constrained as evidenced by a current ratio of 0.66, meaning current assets are insufficient to cover current liabilities without relying on debt restructuring or asset sales. Return metrics include a Return on Assets of 4.6%, while Return on Equity is N/A, revealing that management is utilizing assets to generate modest returns but is currently unable to generate returns for shareholders due to the negative equity position.
Valuation Assessment
Valuation metrics for the stock include a trailing twelve-month P/E ratio of N/A and a forward P/E of 2.48, implying that the market is pricing the stock based on future earnings expectations rather than historical performance, which often occurs during periods of current unprofitability. The price-to-book ratio is -0.20, indicating that the market values the company at less than its book value, a scenario typical for firms with significant liabilities or negative retained earnings. Alternative valuation measures such as the price-to-sales ratio of 0.13 and an EV/EBITDA of 11.33 suggest that the stock is priced at a low multiple relative to its sales and adjusted earnings, reflecting investor caution regarding the company's current earnings trajectory. The stock has traded between a 52-week low of $9.61 and a 52-week high of $31.01, and without the specific current share price in the provided facts, the exact percentage distance from these levels cannot be calculated, but the wide range demonstrates significant price volatility over the past year. Risk assessment is supported by a beta of 1.16, which indicates that the stock price tends to be more volatile than the broader market, moving 16% more aggressively than the index in response to market-wide movements.
Growth & Income
Revenue growth year-over-year is -5.8%, while earnings growth year-over-year is N/A, indicating that the company is currently shrinking in top-line sales rather than expanding its market share or increasing volume. The absence of positive earnings growth data combined with negative revenue growth suggests that the company is in a contractionary phase rather than a growth phase, which impacts the sustainability of any income strategies. The company reports a dividend yield of 15.7% with a payout ratio of 31.0%, a combination that is financially anomalous given the reported net income of -$97,326,000, as a standard payout ratio calculation divides dividends by net income, and paying dividends while reporting a net loss typically signals a non-sustainable distribution policy or a specific accounting classification of the payout ratio metric. Consequently, the dividend yield appears to be a high-return metric that investors must scrutinize closely against the reality of negative net income. The overall growth and income profile presents a mixed picture characterized by declining revenue, negative profitability, and an unusually high dividend yield that does not align with traditional sustainable payout models for a company with negative earnings.