Shake Shack (SHAK) AI Stock Analysis

• Market Cap: $3.92B
• Dividend Yield: N/A
• Average Volume (3M): 1.16M
• Price to Earnings (P/E): 201.1
• Beta (1Y): 1.35
• Revenue Growth: 13.13%
• EPS Growth: -25.05%
• Country: US
• Employees: 12,826
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Restaurants
• EPS (TTM): 0.44
• Shares Outstanding: 40,247,757
• 10 Day Avg. Volume: 1,126,053
• 30 Day Avg. Volume: 1,161,371
• PEG Ratio: -10.51
• Price to Book (P/B): 11.19
• Price to Sales (P/S): 4.20
• P/FCF Ratio: 147.49
• Enterprise Value/Market Cap: 1.56
• Enterprise Value/Revenue: 4.64
• Enterprise Value/Gross Profit: 11.69
• Enterprise Value/Ebitda: 44.82
• 1Y Price Target: $114.56
• Price Target Upside: 24.73% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 19

• Rating: 57 Neutral
• Price Target: $101.00 ▲(9.96% Upside)

Shake Shack's overall stock score reflects a mix of strong earnings performance and strategic growth initiatives, tempered by technical weakness and high valuation concerns. The company's robust expansion plans and improved margins are positive, but the stock's current technical and valuation metrics suggest caution.

Positive Factors

Revenue Growth

Shake Shack's consistent revenue growth, driven by new openings and positive sales trends, indicates strong market demand and effective expansion strategies.

Margin Improvement

Improved margins reflect operational efficiency and cost management, enhancing profitability and financial health over the long term.

Expansion Strategy

Aggressive expansion plans demonstrate Shake Shack's commitment to growth and increasing market presence, supporting long-term revenue potential.

Negative Factors

High Leverage

High leverage can strain financial flexibility and increase risk, potentially impacting the company's ability to invest in growth opportunities.

Low Operational Margins

Low operational margins indicate potential inefficiencies, which could limit profitability and require strategic adjustments to improve performance.

Regional Underperformance

Regional underperformance highlights market-specific challenges that could affect overall growth and necessitate targeted strategies to improve results.

Shake Shack Business Overview & Revenue Model

Company Description

Shake Shack Inc. owns, operates, and licenses Shake Shack restaurants (Shacks) in the United States and internationally. Its Shacks offers hamburgers, hot dogs, chicken, crinkle cut fries, shakes, frozen custard, beer, wine, and other products. As of December 29, 2021, it operated 369 Shacks, including 218 domestic company-operated Shacks, 25 domestic licensed Shacks, and 126 international licensed Shacks. Shake Shack Inc. was founded in 2001 and is headquartered in New York, New York.

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 shows a positive growth trajectory with improving profitability and strong cash flow generation. However, high leverage and low operational margins present potential risks. Continued focus on operational efficiency and debt management could enhance financial stability and performance.

Income Statement

Shake Shack's income statement shows a positive trajectory with a revenue growth rate of 3.12% TTM, indicating steady expansion. The gross profit margin of 39.68% is healthy, though it has decreased from the previous year. The net profit margin improved to 1.50% TTM, reflecting better profitability. However, the EBIT margin remains low at 2.27%, suggesting room for operational efficiency improvements.

Balance Sheet

The balance sheet reveals a high debt-to-equity ratio of 1.70 TTM, indicating significant leverage, which could pose financial risks. Return on equity is modest at 4.20% TTM, showing some profitability but also highlighting potential for improvement. The equity ratio is stable, suggesting a balanced asset structure.

Cash Flow

Cash flow analysis shows a robust free cash flow growth rate of 15.80% TTM, indicating strong cash generation capabilities. The operating cash flow to net income ratio of 0.90 TTM suggests efficient cash conversion. However, the free cash flow to net income ratio of 0.25 TTM indicates room for improvement in cash flow management.

Breakdown	TTM	Dec 2024	Dec 2024	Dec 2023	Dec 2023	Dec 2022
Income Statement
Total Revenue	1.32B	1.25B	1.25B	1.09B	1.09B	900.49M
Gross Profit	524.90M	573.92M	573.92M	398.39M	398.39M	381.54M
EBITDA	136.88M	120.89M	120.89M	111.74M	111.74M	51.53M
Net Income	19.89M	10.21M	10.21M	20.26M	20.26M	-25.97M
Balance Sheet
Total Assets	1.78B	1.70B	1.70B	1.61B	1.61B	1.49B
Cash, Cash Equivalents and Short-Term Investments	336.80M	320.71M	320.71M	293.21M	293.21M	311.23M
Total Debt	837.59M	809.62M	809.62M	771.33M	771.33M	714.05M
Total Liabilities	1.26B	1.20B	1.20B	1.14B	1.14B	1.08B
Stockholders Equity	494.10M	470.02M	470.02M	443.42M	443.42M	395.12M
Cash Flow
Free Cash Flow	46.22M	35.66M	35.66M	-14.03M	-14.03M	-65.82M
Operating Cash Flow	183.16M	171.16M	171.16M	132.14M	132.14M	76.74M
Investing Cash Flow	-133.94M	-66.08M	-66.08M	-132.32M	-132.32M	-143.42M
Financing Cash Flow	-14.25M	-9.02M	-9.02M	-5.68M	-5.68M	-5.20M

Shake Shack Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 91.85
• 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 Neutral. The current price of 91.85 is below the 20-day moving average (MA) of 92.60, below the 50-day MA of 97.62, and below the 200-day MA of 108.56, indicating a neutral trend. The MACD of -1.76 indicates Negative momentum. The RSI at 47.49 is Neutral, neither overbought nor oversold. The STOCH value of 47.25 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for SHAK.

Shake Shack Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CAVA	―	$7.37B	53.57	20.90%	―	28.21%	227.11%
NATH	―	$442.08M	18.74	―	1.85%	6.38%	9.98%
PBPB	―	$517.96M	48.09	19.65%	―	-1.72%	-70.31%
Sector *	―	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
WEN	―	$1.71B	9.37	99.35%	8.69%	1.31%	-1.46%
SHAK	―	$3.92B	201.06	4.16%	―	13.13%	-25.05%
JACK	―	$334.79M	-5.03	―	9.93%	-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.