Jersey Mike's to Report First Quarterly Results Since Blackstone-Backed IPO

Dow Jones
Sep 08
 

Jersey Mike's Subs is set to report its first quarterly results since its public debut in July before the market opens Wednesday. Here is what you need to know.

NET INCOME: The sandwich chain is expected to post a second-quarter profit of $35.6 million, according to analysts polled by FactSet.

ADJUSTED EARNINGS: Stripping out one-time items, earnings are projected to come in at 22 cents a share.

SALES: Quarterly sales are forecast to stand at roughly $208.7 million.

COMPARABLE SALES: Same-store sales, which account for store openings and closings, are anticipated to be up 2.3%.

Jersey Mike's shares were recently trading hands at $20.85.

WHAT TO WATCH

-- Blackstone bought a majority stake in Jersey Mike's Subs early last year for about $6 billion plus debt. A team of roughly a dozen Blackstone dealmakers and executives then focused on readying Jersey Mike's for an IPO over the subsequent year and a half, The Wall Street Journal previously reported. The New Jersey-born chain had its public debut in July, valuing the company at roughly $8 billion.

-- Jersey Mike's is aiming to grow from about 3,300 stores to 15,000 worldwide, meaning the company has to start winning over Gen Z in an era of fickle wellness trends and viral food crazes. Roughly 70% of Jersey Mike's customers are Gen Xers or Boomers, while Gen Z accounts for just 2%, according to Wall Street analyst reports citing company figures. In an effort to reach more Gen Z customers, Jersey Mike's is shifting its TV-heavy advertising strategy toward more segmented channels such as Instagram and TikTok.

-- UBS analysts in August initiated coverage on Jersey Mike's with a buy rating and $28 price target. The analysts called the chain a unique asset, combining leading top-line growth, margins and cash generation, with a still significant store total addressable market. Over the next 10 years, UBS estimates that Jersey Mike's can generate 10% revenue growth. "We anticipate strategic plans across menu innovation, marketing, and digital & delivery should support continued positive same-store sales over the coming years, w/ a sizable new customer acquisition opportunity," they wrote.

 
 

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