For the past two months investment contributors at the Motley Fool have been doing their best to convince potential QSR investors that the management in charge of the quick-service restaurant Jack in the Box were deliberately using misleading verbaige to disguise the painful truth. But just a few months later and those same investment sources are projecting that there could still be some value waiting to pop out for patient shareholders. So where's the appeal? Does Jack in the Box have great margins like other QSR brands such as McDonald's, or possibly they are showing superb returns like YUM! Brands, or perhaps they are a unique concept like the Cheesecake Factory? No, not really.
But what the quick-service chain Jack in the Box does have, is a low valuation and the potential to do a lot better. Jack in the Box is still mostly a regional chain, which suggests that above-average unit growth is still possible. Also of positive note is the fact that this growing QSR company appears to do be doing pretty well on a sales-per-square foot basis relative to the rest of the fast-food sector. And last but certainly not least, Jack in the Box could definitely refranchise its restaurants and generate better returns on capital.
