Edit
Financing

Jack in the Box stock surges on sale report

Reuters reported that the company is exploring strategic alternatives.
Photograph: Shutterstock

Jack in the Box sold one brand. Now it might sell its other one.

Stock in the San Diego-based burger chain rose 7% on Thursday after Reuters reported that the company is considering strategic alternatives, including a potential sale.

That would come a year after the company divested its Qdoba business.

A Jack in the Box spokesman said that the company does not comment on “market rumors or speculation.”

The sale process would be the latest in what has been an active period for restaurants, especially those that are publicly traded. Public stock investors aren’t valuing companies to the same level as are private investors, which has led to a flurry of sales of publicly traded restaurants.

Fogo de Chao, Sonic Corp. and Zoes Kitchen have all gone private this year. And Bojangles’ Famous Chicken 'n Biscuits has a deal with a pair of investment firms. Papa Murphy’s is up for sale, and so is Papa John’s.

Jack in the Box has struggled in a difficult burger market this year. Same-store sales rose just 0.5% in the company’s fiscal fourth quarter, leading the company to increase its discounts in a bid to win over customers.

The system is also facing an open revolt from its franchisees, who have called upon the company to replace CEO Lenny Comma and requested representation on the company’s board of directors.

But a buyer would also get a single brand that has cut corporate overhead and refranchised most of the system, even as it has controlled many of its franchisees’ leases.

Jack in the Box operates more than 2,200 locations, mostly in the West and the South.

Trending

More from our partners