Stifel Upgrades Jack In The Box to “Buy,” Raises Price Target Amid Strategic Overhaul
New Leadership, New Strategy
Stifel analysts upgraded Jack In The Box Inc (NASDAQ: JACK) to “Buy” from “Hold”, highlighting the appointment of Lance Tucker as CEO as a major positive catalyst.
The firm also raised its price target to $35 from $32, citing a more focused operational and financial strategy.
Key Strategic Initiatives
Debt Reduction Plan:Jack In The Box aims to reduce debt by over $300 million over the next 12–18 months.
Real Estate and Asset Sales:The company plans to sell restaurant real estate, eliminate its quarterly dividend, and divest Del Taco to free up cash.
Operational Streamlining:Jack intends to close 150–200 underperforming units, allowing it to refocus resources on higher-return opportunities.
Financial and Competitive Outlook
Lower Leverage Expected:Stifel estimates that Jack’s financial leverage could fall below 5x by fiscal 2026, significantly lowering its risk profile.
Growth Potential:Despite recent same-store sales declines, analysts see upside if the company successfully executes its turnaround.
“We believe the equity value will improve as debt is repaid. Additionally, the valuation should benefit from the company owning a single, highly franchised brand with a focus on growing comp sales,” Stifel analysts wrote.
