Please ensure Javascript is enabled for purposes of website accessibility

Why Shares of Jack in the Box Soared on Thursday

By Daniel Sparks - Apr 16, 2020 at 3:36PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The fast-food chain's business held up better than expected amid the COVID-19 pandemic.

What happened

Shares of fast-food chain Jack in the Box (JACK 3.25%) soared on Thursday, rising as much as 21.6%. As of 3:05 EDT, however, the stock was up 19.2%.

The stock's gain follows a business update from the fast-food company after market close on Wednesday, showing preliminary results that may have been better than some investors were expecting in light of the weak economic environment.

A chart showing a stock price moving higher

Image source: Getty Images.

So what

The company said total same-store sales for its fiscal second quarter, which ended on April 12, are estimated to have declined 4.2% year over year. On average, analysts were expecting same-store sales in Jack in the Box's fiscal second quarter to decline 9.4%. 

For the seven-week period ending March 8 (the period before consumers began sheltering at home), same-store sales were up 5.2% year over year.

The company also importantly said that more than 99% of its restaurants remain open during the COVID-19 pandemic.

Now what

Looking ahead, the company opted to withdraw its 2020 guidance, citing the "unprecedented adverse impact of the COVID-19 pandemic on business results..." This is a common move for many companies during this time as businesses cope with uncertainty.

Daniel Sparks has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Jack in the Box Inc. Stock Quote
Jack in the Box Inc.
$87.67 (3.25%) $2.76

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 08/12/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.