Shake Shack Shares Explode on Earnings Beat

Shares of Shake Shack, an American fast casual restaurant, were soaring on Monday in after-hours trading after the New York-based company reported its financial results for the second quarter.

Shake Shack reported net income of $9 million, or 29 cents a share, up from $7.6 million, or 26 cents a share, a year ago. Excluding items, the company said it earned 27 cents a share. This was ahead of the 23 cents that analysts had expected according to Refinitiv. Revenue at $152.7 million was a jump of 31% and was better than the $149.5 million that had been expected.

Sales at the company’s stores open more than a year rose 3.6% while analysts had expected same-store sales to rise 2.0%.

“More than halfway through 2019, we are pleased to report continued strong momentum into the second quarter across all areas of the business,” said Shake Shack’s CEO Randy Garutti in a press release.

He added, “Our digital channels, including delivery, were a key contributor to these results, in conjunction with a benefit from the shift in Easter timing within the second quarter.”

Looking ahead, the company also upped its forecast and now expects revenue of between $585 million and $590 million, up from a prior range of $576 million to $582 million. Analysts expected 2019 sales of $591 million.

The company also announced that it would be teaming up with Grubhub to offer delivery and that the partnership will be tested in four locations and will roll out over the next several quarters.

“Shake Shack is experiencing incredible growth. Now more than ever, we’re doubling down on our commitment to be an accessible, omnichannel business,” Garutti also said. “The Shake Shack-Grubhub partnership demonstrates our strategic commitment to digital innovation and guest experience, and represents an important component in our overall digital ecosystem, including web-ordering, mobile app, kiosk and delivery.”

Shares of Shake Shack have seen gains of over 60% so far this year.

Disclaimer: We have no position in Shake Shack Inc. (NYSE: SHAK) and have not been compensated for this article.