{
  "@context": "https://frontierpicks.com/schemas/dossier.v1.json",
  "ticker": "SHAK",
  "name": "Shake Shack Inc.",
  "url": "https://frontierpicks.com/dossiers/SHAK/",
  "json_url": "https://frontierpicks.com/dossiers/SHAK.json",
  "status": "DORMANT",
  "current_conviction": "LOW",
  "archetype": {
    "code": "a7",
    "n": 7
  },
  "current_thesis": "Shake Shack's shares are more likely to lag the S&P 500 over the next three months: the 5 November 2026 report held full-year ranges, but margin sits in the lower half of its range and 2027 has no outlook. Fourth-quarter results due around February 2027 settle it.",
  "invalidation_trigger": "A daily close above $86.30, which is over the $75.04 close of 2026-11-11 and would show the shares leading the S&P 500 again. A raised full-year profit outlook or a 2027 outlook above current ranges would also show the shares leading.",
  "catalyst_date": null,
  "portfolio": null,
  "pick": null,
  "themes": [
    "consumer-discretionary-rotation"
  ],
  "tags": [],
  "sources": [],
  "caveats": [],
  "source_links": [
    {
      "title": "Shake Shack Inc. - Form 8-K - FY2026",
      "url": "https://www.sec.gov/Archives/edgar/data/0001620533/000162053326000040/shak-20261105_exhibit991.htm",
      "date": "2026-11-05"
    },
    {
      "title": "Shake Shack Inc. - Form 8-K - FY2026",
      "url": "https://www.sec.gov/Archives/edgar/data/0001620533/000162053326000040/a3q26shareholderletter.htm",
      "date": null
    },
    {
      "title": "Shake Shack Inc. - Form 10-Q - FY2026",
      "url": "https://www.sec.gov/Archives/edgar/data/0001620533/000162053326000041/shak-20260930.htm",
      "date": null
    }
  ],
  "evidence": [
    {
      "claim": "Q3 2026 total revenue was $423.3 million, up 15.2%; same-Shack sales rose 2.5% with traffic up 0.8%.",
      "source": "Q3 2026 shareholder letter, Form 8-K",
      "as_of": "2026-11-05"
    },
    {
      "claim": "Restaurant-level profit margin was 22.5% of Shack sales, down from 22.8%; adjusted EBITDA rose 16.0% to $62.8 million.",
      "source": "Q3 2026 shareholder letter, Form 8-K",
      "as_of": "2026-11-05"
    },
    {
      "claim": "Beef, about 35% of the food and paper basket, rose low single digits year on year in Q3 2026.",
      "source": "Q3 2026 shareholder letter, Form 8-K",
      "as_of": "2026-11-05"
    },
    {
      "claim": "Fiscal 2026 ranges: revenue $1.6–1.7 billion, adjusted EBITDA $225–235 million, net income $45–55 million, restaurant-level margin 22.0–23.0%.",
      "source": "Q3 2026 shareholder letter, Form 8-K",
      "as_of": "2026-11-05"
    },
    {
      "claim": "The company added a 1% menu price increase in October 2026 and expects licensed openings at the high end of 40–45.",
      "source": "Q3 2026 shareholder letter, Form 8-K",
      "as_of": "2026-11-05"
    },
    {
      "claim": "JPMorgan kept a Neutral rating on Shake Shack and raised its price target to $77.",
      "source": "Benzinga headline",
      "as_of": "2026-11-10"
    },
    {
      "claim": "CEO Rob Lynch said lower-income Americans are feeling the pinch.",
      "source": "News headline, Q3 2026 earnings coverage",
      "as_of": "2026-11-05"
    }
  ],
  "view_changes": [],
  "frame": null,
  "filed_numbers": {
    "as_of": "2026-11-13",
    "sector": "Consumer Cyclical",
    "financials": {
      "status": "ok",
      "reason": null,
      "close_date": "2026-11-13",
      "latest_quarter": "2026-09-30",
      "figures": {
        "revenue": {
          "status": "ok",
          "quarters": [
            {
              "end": "2026-09-30",
              "filed": "2026-11-05",
              "restated": null,
              "value_musd": 423.3,
              "yoy_pct": 15.2
            },
            {
              "end": "2026-07-01",
              "filed": "2026-08-05",
              "restated": null,
              "value_musd": 417.6,
              "yoy_pct": 17.2
            },
            {
              "end": "2026-04-01",
              "filed": "2026-05-07",
              "restated": null,
              "value_musd": 366.7,
              "yoy_pct": 14.3
            },
            {
              "end": "2025-12-31",
              "filed": "2026-02-26",
              "restated": null,
              "value_musd": 400.5,
              "yoy_pct": 21.9
            },
            {
              "end": "2025-09-24",
              "filed": "2025-10-30",
              "restated": null,
              "value_musd": 367.4,
              "yoy_pct": 15.9
            },
            {
              "end": "2025-06-25",
              "filed": "2025-07-31",
              "restated": null,
              "value_musd": 356.5,
              "yoy_pct": 12.6
            }
          ]
        },
        "gross_margin": {
          "status": "not reported"
        },
        "operating_margin": {
          "status": "ok",
          "quarters": [
            {
              "end": "2026-09-30",
              "filed": "2026-11-05",
              "restated": null,
              "pct": 5.1
            },
            {
              "end": "2026-07-01",
              "filed": "2026-08-05",
              "restated": null,
              "pct": 5
            },
            {
              "end": "2026-04-01",
              "filed": "2026-05-07",
              "restated": null,
              "pct": -0.7
            },
            {
              "end": "2025-12-31",
              "filed": "2026-02-26",
              "restated": null,
              "pct": 4.7
            },
            {
              "end": "2025-09-24",
              "filed": "2025-10-30",
              "restated": null,
              "pct": 5
            },
            {
              "end": "2025-06-25",
              "filed": "2025-07-31",
              "restated": null,
              "pct": 6.3
            }
          ]
        },
        "pretax_income": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-05",
          "value_musd": 23.4
        },
        "net_income": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-05",
          "four_quarters_end": "2026-09-30",
          "value_musd": 16.5,
          "four_quarters_musd": 43.7
        },
        "operating_cash_flow": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-05",
          "first_end": "2025-12-31",
          "value_musd": 199.2
        },
        "capital_spending": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-05",
          "first_end": "2025-12-31",
          "value_musd": 221.6
        },
        "free_cash_flow": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-05",
          "first_end": "2025-12-31",
          "value_musd": -22.4
        },
        "diluted_share_change": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-05",
          "base_end": "2025-09-24",
          "pct": 0.1
        },
        "cash": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-05",
          "value_musd": 319
        },
        "debt": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-05",
          "value_musd": 248.5,
          "composition": "long-term debt"
        },
        "net_cash": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-05",
          "value_musd": 70.5
        },
        "deferred_revenue": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-05",
          "value_musd": 20.4,
          "yoy_pct": -3.4
        },
        "backlog": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-05",
          "value_musd": 25.7,
          "yoy_pct": -7.4
        },
        "receivables": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-05",
          "value_musd": 30.6
        },
        "inventory": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-05",
          "value_musd": 7.6
        },
        "equity": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-05",
          "value_musd": 564
        },
        "market_value": {
          "status": "ok",
          "close_date": "2026-11-13",
          "basis_end": "2026-09-30",
          "basis_filed": "2026-11-05",
          "value_musd": 3142.4
        },
        "enterprise_value": {
          "status": "ok",
          "close_date": "2026-11-13",
          "basis_end": "2026-09-30",
          "basis_filed": "2026-11-05",
          "value_musd": 3071.9
        },
        "ev_sales": {
          "status": "ok",
          "close_date": "2026-11-13",
          "basis_end": "2026-09-30",
          "basis_filed": "2026-11-05",
          "multiple": 1.9
        },
        "ev_ebit": {
          "status": "ok",
          "close_date": "2026-11-13",
          "basis_end": "2026-09-30",
          "basis_filed": "2026-11-05",
          "multiple": 52.7
        },
        "pe": {
          "status": "ok",
          "close_date": "2026-11-13",
          "basis_end": "2026-09-30",
          "basis_filed": "2026-11-05",
          "multiple": 71.9
        },
        "pb": {
          "status": "ok",
          "close_date": "2026-11-13",
          "basis_end": "2026-09-30",
          "basis_filed": "2026-11-05",
          "multiple": 5.6
        },
        "fcf_yield": {
          "status": "ok",
          "close_date": "2026-11-13",
          "basis_end": "2026-09-30",
          "basis_filed": "2026-11-05",
          "pct": -0.7
        }
      }
    },
    "short_interest": {
      "status": "ok",
      "settlement": "2026-10-15",
      "published": "2026-10-26",
      "short_pct_of_outstanding": 8.65,
      "days_to_cover": 2.7,
      "change_pct": 1.1
    },
    "insiders": {
      "status": "ok",
      "as_of": "2026-11-15",
      "windows": [
        {
          "days": 90,
          "status": "ok",
          "from": "2026-08-18",
          "bought_usd": 0,
          "sold_usd": 0,
          "bought_unpriced": 0,
          "sold_unpriced": 0
        },
        {
          "days": 365,
          "status": "ok",
          "from": "2025-11-16",
          "bought_usd": 3232508.7,
          "sold_usd": 178081.18,
          "bought_unpriced": 0,
          "sold_unpriced": 0
        }
      ]
    }
  },
  "body_markdown": "## Current Thesis\n\nShake Shack's shares are more likely to lag the S&P 500 than lead it over the next three months. The third-quarter report on 2026-11-05 removed the margin scare from beef costs, but it left full-year profit ranges unchanged and gave no 2027 outlook. Fourth-quarter results, due around February 2027, settle whether a 1% menu price increase can hold margin and traffic.\n\nThe shares rebounded after the report. They closed at $69.82 on 2026-11-05, reached $77.15 on 2026-11-09 and closed at $75.04 on 2026-11-11, just above the 200-day average of $74.20. JPMorgan kept a Neutral rating and raised its price target to $77 on 2026-11-10. The price now reflects a business that is meeting its guided ranges, with little room left for a disappointment on margin.\n\n## Bull Case\n\n- **Beef cost relief arrived.** Beef, about 35% of the food and paper basket, rose low single digits year on year in the third quarter, after mid-teens inflation in the second quarter (company shareholder letter, 2026-11-05). Blended food and paper costs fell low single digits.\n- **Profit grew faster than sales.** Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) rose 16.0% to $62.8 million, against revenue growth of 15.2% to $423.3 million (shareholder letter, 2026-11-05).\n- **Traffic is still positive.** Same-Shack sales rose 2.5%, with traffic up 0.8%. The letter calls it the fifth straight quarter of positive traffic and the 23rd straight quarter of positive same-Shack sales (2026-11-05).\n- **Licensing is running at the high end.** Third-quarter licensing revenue was $15.3 million, up 4.7%. Management expects licensed openings at the high end of the 40–45 range, with fourth-quarter debuts in Panama, Vietnam and PENN Entertainment casinos (shareholder letter, 2026-11-05).\n- **Broker targets are moving up.** JPMorgan, rated Neutral, raised its target to $77 on 2026-11-10, five days after the report (Benzinga headline).\n\n## Bear Case\n\n- **Margin slipped again.** Restaurant-level margin of 22.5% compares with 22.8% a year earlier and 23.0% in the second quarter (shareholder letters, 2026-08-05 and 2026-11-05). It sits in the lower half of the 22.0–23.0% guided range.\n- **Sales growth is slowing.** Same-Shack sales growth fell to 2.5% from 3.5% in the second quarter, when management said a World Cup lift helped (shareholder letters, 2026-08-05 and 2026-11-05).\n- **Consumer warning from the chief executive.** CEO Rob Lynch said lower-income Americans are feeling the pinch (news headline, 2026-11-05). The company added a 1% menu price increase in October, which tests traffic.\n- **Guidance did not rise.** Full-year ranges are unchanged: adjusted EBITDA $225–235 million, net income $45–55 million, revenue $1.6–1.7 billion (shareholder letter, 2026-11-05). Management gave no 2027 outlook.\n- **The rebound uses up the cushion.** The shares closed at $75.04 on 2026-11-11, above the 200-day average, while the one post-report target found, JPMorgan's $77, sits only slightly higher.\n\n## Setup & Price Structure\n\nThe last close was $75.04 on 2026-11-11, 1.9% above the close three months earlier (adjusted daily closes). The 50-day average is $65.48 and the 200-day average is $74.20, so the shares sit above both. They closed at $72.82 on 2026-11-04, $69.82 on 2026-11-05, $71.89 on 2026-11-06, $77.15 on 2026-11-09, $75.90 on 2026-11-10 and $75.04 on 2026-11-11.\n\nThe 52-week high is $107.46 (intraday, 2026-02-26); the last close is 30.2% below it. The 52-week closing low is $52.34, set on 2026-06-05. The 200-day average is the nearest level the shares have just reclaimed; a close back under it would put the post-report rebound in question. No Form 4 insider transactions are listed in recent SEC filings; the only filing is the 10-Q of 2026-11-05.\n\n## Catalyst Calendar\n\n- **~2026-12-30 (est.):** Fourth-quarter debuts in Panama, Vietnam and PENN Entertainment casinos. Shows whether licensing growth reaches the high end of the 40–45 licensed opening range.\n- **~2027-02 (est.):** Fourth-quarter and full-year 2026 results. Settles whether restaurant-level margin stayed in the 22.0–23.0% range, whether adjusted EBITDA reached $225–235 million, and whether the first 2027 outlook raises expectations.\n\n## What Would Change Our Mind\n\nA daily close above $86.30, which is over the $75.04 close of 2026-11-11 and would show the shares leading the S&P 500 again. A raised full-year profit outlook or a 2027 outlook above current ranges would also show the shares leading.\n\n## Correlation Notes\n\nShake Shack trades with US consumer discretionary and restaurant shares. The 2026-11-05 comments on lower-income customers match a wider theme in the sector, and the company's May 2026 share drop followed a McDonald's warning on the same group (ZeroHedge, 2026-05-07). Beef is the main input cost, so cattle and beef price moves bear directly on the margin case.",
  "first_seen": "2026-11-10",
  "last_analyzed": "2026-11-12T17:28:30+00:00",
  "last_synthesized": "2026-11-12",
  "date_modified": "2026-11-12",
  "license": "Content © FrontierPicks. Cite the canonical URL."
}