Why Is Jack In The Box (JACK) Down 19% Since Last Earnings Report?

Jack In The Box (JACK) shares have declined approximately 19% since its last earnings report, underperforming the S&P 500, with estimates trending downward, leading to a Zacks Rank #4 (Sell) rating, signaling expectations of below-average returns in the near term. In contrast, Cheesecake Factory (CAKE), a peer in the Retail-Restaurants industry, has gained 6.8% over the past month, reporting a 4% year-over-year revenue increase to $927.2 million and EPS of $0.93, although current quarter earnings are projected to decline by 3.7%.

Analysis

Jack In The Box (JACK) has experienced a significant share price decline of approximately 19% since its last earnings report, markedly underperforming the S&P 500. This downturn is accompanied by a clear trend of downward revisions in earnings estimates over the past month, signaling a deterioration in its outlook. Despite possessing strong Momentum (A) and Value (A) VGM Scores, its subpar Growth Score (D) and the overall negative trajectory of estimates have culminated in a Zacks Rank #4 (Sell), indicating an expectation of below-average returns in the coming months. In contrast, industry peer Cheesecake Factory (CAKE) has seen its shares gain 6.8% over the past month. CAKE reported a 4% year-over-year revenue increase to $927.2 million and an EPS of $0.93 for the quarter ended March 2025, up from $0.73 a year ago. However, for the current quarter, CAKE's earnings are projected to decline by 3.7% year-over-year to $1.05 per share, and its Zacks Consensus Estimate has seen a -1.6% revision over the last 30 days, leading to a Zacks Rank #3 (Hold) and a VGM Score of A. The magnitude of downward revisions for JACK is a key concern, suggesting fundamental headwinds.

Key Decisions for Investors

• Investors should exercise caution with Jack In The Box (JACK) due to its significant recent underperformance, downward earnings estimate revisions, and Zacks Rank #4 (Sell) rating, potentially considering a reduction in exposure.
• While JACK exhibits attractive Value and Momentum scores, the overriding negative earnings outlook and poor Growth score suggest these factors may not be sufficient to drive a near-term recovery.
• For Cheesecake Factory (CAKE), the Hold rating, recent positive stock performance, and strong past earnings contrast with a projected near-term earnings decline and negative estimate revisions, warranting careful monitoring of upcoming results and industry conditions before altering positions.