Shake Shack (NYSE:SHAK) shares rose more than 2% intra-day today after Loop Capital upgraded the company to Buy, setting a price target of $127, as the firm sees the recent pullback in shares as a compelling entry point for investors.
Analysts pointed to the stock’s 25% decline since late January as creating a valuation gap, particularly given the company’s potential to exceed 2025 guidance. Loop bases its target on approximately 25x its 2025 EV/EBITDA estimate, reflecting confidence in continued upside in comparable sales performance.
Shake Shack’s management currently expects adjusted EBITDA of $200 million to $210 million in 2025, but the analysts believe the company could deliver 10%+ above that range if same-store sales momentum holds or accelerates.
With improving fundamentals and a discounted valuation, Loop sees Shake Shack as well-positioned for a rebound, making it an attractive pick in the fast-casual dining sector.