It hasn't taken long for investors to get behind the brand reinvention plan at fast-food chain Jack in the Box (NYSE:JBX). The firm's shares are up significantly since we first reported on the company's three-to-five-year plan for re-energizing itself back in mid-September. Today, investors got more good news, with the company saying fiscal second-quarter earnings per share (EPS) look to come in way ahead of earlier projections.
Jack in the Box, which owns the Qdoba Mexican Grill chains, is now directing investors to expect second-quarter EPS of $0.42 to $0.44, well ahead of the $0.28 previously projected (though possibly flat with the year-ago $0.44 figure). Same-store sales growth of 7.5%, largely driven by new products, as well as better control of food, labor, and fixed costs are all helping the bottom line. Full second-quarter results and third-quarter guidance are scheduled for a May 12 release.
But today's announcement was not all go-go: The company warned investors not to look for massive comps growth in the second half, because of difficult comparisons from the prior year's third and fourth quarters. It's also scaling back second-half capital expenditures, as it holds off on Qdoba expansion and looks to save money at its namesake restaurants.
But based on the Q2 news -- as well as Jack in the Box's assertion that the two stores it opened in San Diego to test its new, more upscale concept are being very well received by customers -- it's easy to understand why the company's shares jumped another 10% in morning trading today.
Only recently seen as collateral damage in the burger wars fought by McDonald's (NYSE:MCD) and Burger King, Jack in the Box has witnessed early success in rebuilding a new, distinctive name for itself.
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Fool contributor Dave Marino-Nachison doesn't own any of the companies in this story.
