Jack In The Box (JACK) Plunges 2.37% Amid Closures, Weak Sales

Jack In The Box (JACK) shares fell to their lowest level since March 2020 today, with an intraday decline of 2.37%.

Jack in the Box Inc. (JACK) has recently experienced a decline in stock price, with a new low reached on April 24, 2025, following the announcement of plans to close underperforming locations and explore the sale of its Del Taco brand. To backtest the impact of this new low on future price movements, we can analyze the stock price performance over various time frames.

One Week After the New Low

- The stock price of JACK decreased by 4.72% on April 24, 2025, following the announcement of the 'JACK on Track' plan.

- Given the negative sentiment surrounding the company's strategic decisions and the market's reaction to the news, it is likely that the stock price may continue to face downward pressure in the immediate term.

One Month After the New Low

- Over the next month, the stock price of JACK could still be influenced by the recent news of restaurant closures and the sale of the Del Taco brand.

- Additionally, the market's reaction to the COVID-19 pandemic and its impact on the restaurant industry could also affect JACK's stock price.

Three Months After the New Low

- By the three-month mark, the stock price of JACK may have stabilized or started to recover if the market perceives the 'JACK on Track' plan as a positive development.

- However, if the company fails to meet its debt repayment targets or if the sale of the Del Taco brand does not yield the expected results, the stock price could remain under pressure.

In conclusion, the impact of JACK reaching a new low on future price movements is likely to be negative in the short term, with the stock price potentially continuing to decline over the next week and month. However, the three-month outlook is more uncertain, as it will depend on various factors such as the company's performance against its 'JACK on Track' plan and broader market conditions. Investors should remain cautious and monitor the company's progress closely.

Jack in the Box's stock price has been impacted by several factors as of May 2025. The company announced in April 2025 its intention to close between 150 and 200 locations. This decision could lead to reputational damage and influence investor sentiment negatively, potentially impacting stock prices.

Additionally, the company has been facing weak same-store sales trends over the past two years. Rising costs have outpaced revenue, leading to a decline in operating margin by 24.2 percentage points. This financial strain, coupled with a 10× net-debt-to-EBITDA ratio, indicates overleverage and potential shareholder dilution risks, which could be negatively affecting its stock price.