BH · Biglari Holdings
Conviction · Low · more likely to lag the S&P 500 over the next three months
Wrong if: a daily close above $449.78
Note written ·
Price against the kill line
19.5% clear of its kill line on the 13 November 2026 close.
How to read this
This note expects the shares to lag the market, so its kill line sits above the price: a close above the red mark would prove the view wrong. Prices run from low on the left to high on the right. The dot is where the stock closed on 13 November 2026, left of the mark while it is below the line; a dot right of the mark has closed through it.
The scale is stretched near the line, so close calls are easy to see. More than 8% from the line, the stock reads well clear, with a hollow dot to show the figure is off the drawn scale.
The kill line is the research note's own test. The portfolio sells on business facts, not on a price. How the portfolio decides
Three months against the kill line
Daily closes, to . Red: the kill line, a daily close above $449.78, on record since 11 November 2026. The shares are down 7.4% since the close; the S&P 500 is down 2.1% over the same sessions. Figures in the note can cover a different window.
Kill line
A daily close above $449.78, well over the 50-day average, which would show the shares leading the S&P 500 despite lower nine-month operating earnings and continued share issuance.
Research onlyNot in the portfolio.
Key figures from the filings · Consumer Discretionary
Quarter to 30 September 2026, filed 6 November 2026
- Revenue, latest quarter ($M)
- 112
- Revenue, change on a year (%)
- +12.4
- Gross margin (%)
- 62.9
- Operating margin (%)
- 8.8
- Free cash flow, four quarters ($M)
- 24.8
- Net cash, cash less debt ($M)
- −1.7
All filed numbers
What Biglari Holdings reports to the SEC in its quarterly and annual filings. Each group states its period and filing date once; a figure dated otherwise says so. Built from the filings known on .
| Quarter to | Revenue ($M) | On a year (%) | Gross margin (%) | Operating margin (%) |
|---|---|---|---|---|
| first filed | 112 | +12.4 | 62.9 | 8.8 |
| first filed | 109 | +7.9 | 62.1 | 5.8 |
| first filed | 97.5 | +2.6 | 61.6 | −4.2 |
| first filed | 99.9 | +9.6 | 58.3 | −1.7 |
| first filed | 99.7 | +10.3 | 58.1 | 6.9 |
| first filed | 101 | +10.4 | 60.2 | 3.7 |
| Pre-tax income ($M) | 1.4 |
| Net income ($M) four quarters: −23.4 | 1.0 |
| Diluted shares, change on a year (%) | Not reported |
| Operating cash flow ($M) | 56.3 |
| Capital spending ($M) | 31.4 |
| Free cash flow ($M) | 24.8 |
| Cash and short-term investments ($M) | 213 |
| Debt ($M) non-current long-term debt plus current debt | 215 |
| Net cash, cash less debt ($M) | −1.7 |
| Deferred revenue ($M) −22.3% on a year | 2.9 |
| Backlog, orders not yet delivered ($M) | Not reported |
| Receivables ($M) | 25.7 |
| Inventory ($M) | 4.1 |
| Shareholders' equity ($M) | 595 |
| Market value ($M) | Not available |
| Enterprise value, market value plus net debt ($M) | Not available |
| Enterprise value to sales (×) | Not available |
| Enterprise value to operating income (×) | Not available |
| Price to earnings (×) | Not available |
| Price to book value (×) | Not available |
| Free-cash-flow yield (%) | Not available |
Short interest (FINRA, settled 15 October 2026, published 26 October 2026): the share of shares outstanding is not available, 2.2 days of average trading to cover, +11.3% since the previous report.
| Window | Bought | Sold |
|---|---|---|
| 90 daysfrom | $223Kand 2 trades without a stated price | $0 |
| 12 monthsfrom | $21.4Mand 6 trades without a stated price | $0 |
The thesis
Biglari Holdings' Class B shares (BH) are more likely to lag the S&P 500 over the next three months: the third-quarter Steak n Shake gain is real, but nine-month operating earnings are still below last year and the company keeps issuing stock. The fourth-quarter report, expected in early 2027, settles whether the improvement lasts.
The shares closed at $362.47 on 11 November 2026, down 6.6% over three months and below the 50-day average of $372.54 but above the 200-day average of $353.82 (adjusted daily closes). The close was 25.0% below the 52-week intraday high of $483.60 set on 22 January 2026. Since the 6 November 2026 report the shares have swung widely: $322.43 on 6 November 2026, $373.55 on 9 November 2026 and $349.22 on 10 November 2026. The company release does not explain the moves.
The market has priced in most of the recovery: the shares sit within 3% of their three-month-ago level of $388.16 (13 August 2026 close) even though third-quarter pre-tax operating earnings rose to $9,874 thousand from $6,854 thousand a year earlier.
Bullish and bearish views on Biglari Holdings Inc.
The bull case on Biglari Holdings Inc. (BH), in brief: operating earnings kept improving. The bear case: nine-month operating earnings are still lower.
Bull case
- Operating earnings kept improving. Biglari's 6 November 2026 release reported third-quarter pre-tax operating earnings of $9,874 thousand, versus $6,854 thousand a year earlier and $6,274 thousand in the second quarter of 2026.
- Steak n Shake sales accelerated. Same-store sales at domestic company-operated and franchise-partner restaurants rose 18.2% in the third quarter, after 13.8% in the second. Restaurant revenue was $76,820 thousand versus $71,741 thousand a year earlier (10-Q, 30 September 2026).
- Restaurant earnings grew faster than sales. Restaurant pre-tax earnings were $10,721 thousand in the third quarter versus $7,645 thousand a year earlier, and $21,860 thousand over nine months versus $17,394 thousand (10-Q, 30 September 2026).
- Net earnings turned positive. Third-quarter net earnings were $1,014 thousand versus a net loss of $5,291 thousand a year earlier. Nine-month net earnings were $26,409 thousand versus $12,365 thousand (8-K, 6 November 2026).
Bear case
- Nine-month operating earnings are still lower. Pre-tax operating earnings were $12,007 thousand for the first nine months of 2026 versus $20,521 thousand a year earlier (8-K, 6 November 2026). The improvement is confined to the second and third quarters.
- Share issuance continues at scale. The 10-Q shows 10,936 Class A and 112,886 Class B shares sold under the $500 million at-the-market agreement through 30 September 2026. Nine-month proceeds were $66,537 thousand, up from $14,920 thousand for the six months to 30 June 2026.
- Investment results swing earnings. Investments lost $8,472 thousand in the third quarter, and the nine-month investment gain of $22,132 thousand drives most of nine-month net earnings. The release says the company does not regard quarterly investment fluctuations as meaningful.
- Cash fell during the year. Cash and equivalents were $213,377 thousand at 30 September 2026 versus $268,782 thousand at 31 December 2025, while current investments rose to $155,537 thousand from $69,050 thousand (10-Q).
- Controls were reported as not effective earlier this year. Biglari concluded its disclosure controls were not effective at 31 March 2026. The 30 September 2026 conclusion was not confirmed in the filing pages reviewed.
Price setup
BH closed at $362.47 on 11 November 2026. That is above the 200-day average of $353.82 and below the 50-day average of $372.54. The 3-month reference close was $388.16 on 13 August 2026.
The five sessions from 4 November to 11 November 2026 closed between $322.43 (6 November 2026) and $373.55 (9 November 2026). The close of $331.24 on 5 November 2026 followed $372.88 on 4 November 2026.
The 52-week closing low is $247.83 (11 May 2026) and the 52-week intraday high is $483.60 (22 January 2026). Thin float and low volume make releases gap events: the 8 May 2026 first-quarter report was followed by a drop of roughly 19% in one day.
Catalysts ahead
- ~6 March 2027 (est.): Fourth-quarter and full-year 2026 results (date unconfirmed). Shows whether pre-tax operating earnings stay above the third-quarter figure of $9,874 thousand and whether at-the-market issuance continued beyond $66,537 thousand.
What would change the view
A daily close above $449.78, well over the 50-day average, which would show the shares leading the S&P 500 despite lower nine-month operating earnings and continued share issuance.
What it trades with
BH is a holding company: Steak n Shake restaurants, insurance, investment partnerships and other businesses drive results, so it does not track a single sector. Cracker Barrel reported fourth-quarter fiscal 2026 revenue of $849.3 million, down 2.2% year over year (23 September 2026 release), which shows casual dining is uneven. Biglari's investment portfolio ties quarterly net earnings to equity markets, and thin trading in the Class B shares makes price moves larger than company news alone would suggest.
The evidence, claim by claim (7)
- Third-quarter 2026 pre-tax operating earnings were $9,874 thousand versus $6,854 thousand a year earlier; second-quarter 2026 was $6,274 thousand. Biglari Holdings 8-K dated 6 November 2026 (Exhibit 99.1) · as of
- Steak n Shake same-store sales rose 18.2% in the third quarter of 2026 at domestic company-operated and franchise-partner restaurants. Biglari Holdings 8-K dated 6 November 2026 (Exhibit 99.1) · as of
- Third-quarter 2026 net earnings were $1,014 thousand versus a net loss of $5,291 thousand a year earlier; investment results were a loss of $8,472 thousand versus a loss of $14,406 thousand. Biglari Holdings 8-K dated 6 November 2026 (Exhibit 99.1) · as of
- Nine-month 2026 pre-tax operating earnings were $12,007 thousand versus $20,521 thousand in the first nine months of 2025; nine-month net earnings were $26,409 thousand versus $12,365 thousand. Biglari Holdings 8-K dated 6 November 2026 (Exhibit 99.1) · as of
- Restaurant revenue was $76,820 thousand and restaurant pre-tax earnings $10,721 thousand in the third quarter of 2026, versus $71,741 thousand and $7,645 thousand a year earlier. Biglari Holdings 10-Q for the period ended 30 September 2026 · as of
- Through 30 September 2026 Biglari sold 10,936 Class A and 112,886 Class B shares under its at-the-market agreement; nine-month proceeds from common-stock issuance were $66,537 thousand. Biglari Holdings 10-Q for the period ended 30 September 2026 · as of
- Cash and equivalents were $213,377 thousand at 30 September 2026 versus $268,782 thousand at 31 December 2025. Biglari Holdings 10-Q for the period ended 30 September 2026 · as of
Sources
- Biglari Holdings Inc. - Form 8-K - FY2026 · sec.gov ·
- Biglari Holdings Inc. - Form 10-Q - FY2026 · sec.gov