Stocks

Shake Shack…Shakes On

While Beyond Burger made noise going public this week, Shake Shack made some noise of their own.

Shake Shack announced their quarterly earnings this past week.  Despite operating expenses increasing 1% of revenue year over year, the Markets reactive positively to the numbers.

Shake Shack posted net income of $3.6 million, or 9 cents a share, compared with $3.5 million, or 13 cents a share, in the comparable year-earlier period. Revenue jumped to $132.6 million from $99.1 million, while same-store sales gained 3.6%.    In addition, Shake Shack raised their full-year revenue guidance by $6 million and increased its expected same-store sales growth expectations to 1% to 2% from zero to 1%.

Regarding operating expenses, the CEO had this to say:

Shake Shack CEO Randy Garutti specified that the chain had not bumped up menu prices nearly as much as competitors, staying resolutely in a 1 to 2 percent range when it does raise them. (For comparison, Chipotle raised prices by 2.5 percent last quarter.)

While others have negotiated lower fees with delivery partners by forming exclusive deals, Shake Shack is still testing potential partnerships with several delivery services. Given the increased consumer demand for the service, the company is considering raising prices specifically on delivery menus to counteract higher operational costs.

Source

So where is the stock price head next, lets go to the charts?

Monthly Chart (Curve Timeframe) – monthly supply is at $72 and the monthly demand is $38.

Weekly Chart (Trend Timeframe) – the trend is sideways.

Daily Chart (Entry) – Shake Shack has sold off since earnings announcement. No set-up at the moment, but if the daily trend is breached, there might be a set-up to the downside.

This post is my personal opinion. I’m not a financial advisor, this isn’t financial advise. Do your own research before making investment decisions.

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