Jack In The Box Management Disappointed With Q1 Results; Wall Street Agrees

Jack In The Box Inc. JACK shares have been walloped Wednesday evening following worse-than-expected first-quarter 2016 results and concerning guidance.

The company, which operates and franchises Jack In The Box and Qdoba brand restaurants, posted quarterly earnings from continuing operations of $0.94 per share, unchanged from the same quarter last year. Analysts on Wall Street expected Jack In The Box to issue EPS around $1.03.

Sales totaled $470.82 million, up fractionally from the first quarter of 2015, but below the sell-side consensus estimate of $475.5 million. Systemwide same-store sales at Jack In The Box were up 1.4 percent, while comparable-store sales at Qdoba were up 1.8 percent.

Lenny Comma, the company's Chairman and CEO, did not polish the results: "Our first quarter results were disappointing as operating earnings per share were below our expectations. At the Jack in the Box brand, margin expansion offset sales that were below our plan. Solid sales and traffic growth at Qdoba were hampered by lower than expected margins and some non-repetitive costs."

Jack In The Box management said it's looking for second-quarter comps at the name-sake restaurant to be down 3 percent to unchanged and flat to up 3 percent at Qdoba.

Looking ahead to the remainder of 2016, the company has modeled for comps growth in the range of 1-2 percent at Jack and up 2-3 percent at Qdoba. Operating earnings are expected in the range of $3.50-$3.63, near the low end of the sell-side consensus range with midpoint at $3.63.

The stock was last indicated at $61.85, down nearly 20 percent from Wednesday's closing price of $76.91.