This page has been archived and commenting is disabled.
Shake Shak Opens For Trading Valued At 108x EBITDA
Moments ago Shake Shak, aka SHAK, opened for trading, after pricing its IPO at $21 last night, 50% higher than the initial range of $14-16 (subsequently revised to $17-19). It has promptly soared nearly 140% after opening for trading, and was last seen at just over $49.
What does this mean from a valuation standpoint?
Well, the Company's Adjusted LTM EBITDA is $17 million according to its S-1 (the unadjusted EBITDA is well lower).
After selling 5 million share to the public, the company will have a total of 11.2 million Class A and 24.3 million Class B shares outstanding, or a total of 35.5 million.
Add a little over $60 million in net cash, and you get an Enterprise Value of $1.84 billion.
What does this mean on a valuation multiple basis? Well, at last check $17 million in EBITDA fits a little over 100 times in a market cap of $1.8 billion.
So we are happy to report that in this market, in which there clearly are no bubbles, Shake Shak has just opened for trading at a 108x EV/EBITDA.
* * *
So does SHAK make cell phones, cloud-based services (or as Silicon Valley would say, some variant of Mo-Lo-So), Kindle readers, Direct to TV streamers, or something else that is expected to grow at a 20% annual pace in perpetuity?
No. They make...
Presenting: the burger bubble.
»
- 17367 reads
- Printer-friendly version
- Send to friend
- advertisements -
Looks like an In-n-Out clone to me, which makes it yummy food. But why would I pay 108x for that? Or am I required to buy it? Is there some new mandate I am unaware of here?
Can someone at GS please clear this up for me? I wish to comply with every mandate.
Do they accept EBT?
They put BACON on them?
That's gold Jerry!
pods
Yes, but what does Cramer think?
"It's not a lie if you believe it"
Fuck me, what's that? A burger? Brilliant! I can't believe no one has thought of that before. Next thing you know, they'll be stuffing meat scraps into an edible tube.
IN AND OUT > EVERYONE ELSE
hot damn that shit is magical
1. Five Guys
2. In-N-Out
3. ...
4. ...
.
.
7. Shake Shack
8. ...
9. ...
.
.
.
.
157. McDonalds
WTF is a hamburglar? Sounds like a fat porn star.
All restaurant business models are weak with a weak middle class.
Shak should crash to earth very soon.
American stock market innovation in 2015: A burger & fry joint of dubious quality.
Burger joints in my area that I can name off the top of my head:
Non-local chains:
McDonalds
Burger King
Wendy's
Carl's Junior
Jack In The Box
Whataburger
Sonic
Don't know if local:
Five Guy's
Lumpy's
Local chains:
Bob's Burgers
Blake's Lotaburger
And I guarantee that I forgot some. Do we really need a new burger chain?
dude there is so much hot money out there right now! all you have to do is come up with a business model, no matter how rediculous. and it doesnt even have to make money- then IPO and watch the money roll in!
No thanks, I'll eat at home, I'm sleeping with the prep cook.
Five guys is pretty good, but I can still make 'em as good or better at home for a whole lot less $$. I buy whatever chuck or top round roast Safeway (the only grocery store in our area that has an actual meat department on site) has on sale, have the butcher grind it for me, and damn does it ever make a tasty burger.
Get yourself a Kitchen Aid & grind it yourself [is what I do]...
Then you have multiple options:
- If it's chuck, you can trim off the extra fat, & grind that separately [which when you render it down, gives you the tallow, plus a lot of extra ground meat that's good for burritos, taco's nachos, etc.
- The lean chuck you grind for excellent burgers
- and if there are any particular interesting pieces as you go, you can use it as stew or stroganoff meat
PLUS
It gives you the option to mix in other stuff [like ground sirloin]. You can really play around as much as you want and come up with the perfect burger. If you do it right, you can turn a burger into high end eating.
Me, I can't usually get em cuz my girflriend's a vegetarian (which pretty much makes me a vegetarian); but I do love the taste of a good burger.
If your (future) Mrs is vegetarian, at least these might tickle the tastebuds (the Black Bean burgers are pretty good too!) - http://www.buzzfeed.com/deenashanker/veggies-rule-burgers-drool#.inM46pVOb -
There are many "meat-free" burger variants out there, and most of them taste at least OK - although different. By reducing your meat consumption, you "might" also reduce your lifetime risk of gastrointestinal cancers (colon cancer in particular).
they had cramer standing right next to their CEO on CNBS earlier today, as a matter of fact. I was wondering if ZH would put something up about this IPO, and I wasnt disappointed. I was also hoping they would shed some light on their financials, and ZH didnt disappoint. 108x editba, that valuation is fucking hilarious. for a fucking burger joint. and it was perfect to have him talkng up his company right next to a shyster like Cramer on the shyster network.
Buy Cramerica!
Buy Cramerica!
That is a tasty motherfuckin' burger!
Yeah but do they make a "Royaaal with cheese"?
Do they store any dead things?
Their business model is based on how you need to go back and forth to box stores like J Crew and LL Bean because your wife can't decide via mail order which clothes to keep and which to return, and after slow hours of mall angst, you throw in the towel to buy a bacon cheeseburger. These guys are geniuses and its a PAF highly recommended buy*.
What's this "wife" thing anyway??
Oh yeah!... I sold it a long time ago..
Lucky! I had to pay to get rid of mine...
This article is flawed!
Burgers are not a in bubble as the Americans (and others...) will never give up their high-calories high-fat diet...
this is just another case of insiders able to buy into something cheap before the IPO, let it open and double as yeild chasing fools try to pile into the next big thing, allowing those who bought in at sub 15/share to nearly triple their investment in a matter of hours and then dump it on foolish retail investors who don't want to miss out on the next facebook or twitter
perfect explanation!
P < P + I
You seem to think there is a market. There is a rigged game in favour of the house.
It's like playing Blackjack in a casino where the dealer has a seperate deck of cards considing of alternate Jack of Clubs and Aces.
that was not an implication that i think there is a 'market' in a traditional sense of the word. In a real market, based on fundamentals, there is no way in hell a burger joint would be IPOing at 108x.
It's not just the jaw-dropping "Market Valuation" vs. even "adjusted" income, but the equally jaw-dropping fact that, in a market sector where the "King of the Hill" McDonalds has seen a DROP in profits, a newcomer is "valued" at a whopping $1.8 Billion, in an economy where discretionary spending (amongst the masses) is dropping as "mandatory" spending cuts ever deeper into "whatever's left over".
Probably just another case of "Grab the money and do a runner" in today's "new normal" economy . . . .
In todays world, making a burger is obviously genius. MCD still can't figure it out.
MCD's prices are becoming prohibitive. It costs me almost $11 for a 1/4lb lg fry, and lg coffee here in Kanada.
+1 JungleCat. My first thought is, having eaten both SnakeShak and In-n-Out that I'd rather die choking on In-n-Out than pay to eat ShitShak for their overpriced hipster retard burgers.
Burgers, Apples. Easy mistake to make......
I can haz Krispy Kreme?
Dafuq is a shake shak? Never heard of it.
McDonalds for the silicon alley set.
I'm more of a BEER BORDELLO kind of guy.
We got one here in Philly. I have eaten there and it's good, but it's still just a burger, fries and shake. I wouldn't run out and buy stock in the thing.
Exactly right. Good food but you pay for the quality. It's about $20 for a burger, fries and a beer. They can't just put these things everywhere in the U.S. like McDonalds.
Watch out for the SHAK attack!
Internet bubble: 2000
Housing bubble: 2008
Food bubble: 2015
The Food bubble is legimitate as long as American waist sizes continue to increase.
You mean 20% annual growth?
Ok, I'll go long wheelchairs, escalators and sweatpants.
I'll go long to. Fatsos require more healthcare.
Don't forget yoga pants! *shudders*
long oxygen tanks
The number of up-scale or premium burger places around here has skyrocket in the past couple of years. Sure the food is pretty good at most of them, but there can't possibly be enough demand to keep them all in business. In fact, the Beck's Prime closest to me just closed down after appartently losing the battle with Grub and Twisted Root practically next door.
Well, at least I know what I want for lunch today. Beck's Prime.
Shake Shak sounds kinda shaky.
And they have all of 34 locations. Which happen to mainly be in finance centers, so the Wall Street goons think they're special.
And unlike other absurd evaluations, this one doesn't even offer the potential for some sort of disruption. It's just burgers.
Crumbs redux. Expand on venture capital, explode in NYC, IPO, go bankrupt, rinse, repeat. In the case of Crumbs, they had a full kitchen in every store ... TERRIBLE plan ... but they didn't care, they are looking to sell The Brand with a hope for some sort of licensing or retail payoff later.
I've got to say, I've watched some seriously fucked-up new businesses prosper by being close to the money flow. Here in State U. town, the massive student-housing building spree (along with the student loan bubble) has allowed some of the most worthless businesses I've seen to do insane amounts of business selling crap that is suddenly seen as uber cool.
It will be interesting to watch them as the fad wears off.
Just wait until they start offering T-shirts and free wi-fi..this could be the next Apple.
Bubble Bobble: 1986
Awesome arcade game.
So what, AAPL traded for 40x earnings begin 2007. Turned out to be a great investement.
Yes, because making a hamburger is disruptive to everything we've done before.
*golf clap*
It's not just a burger they sell. It's a burger in a bag, which we all know is much more efficient than a burger in a wrapper.
Why not serve burgers in a trough? Or better yet a food bag? The American whale deserves no less.
Mmm... Burger...
Chipotle-like? Who knows. The markets no longer make sense. To the moon alice with shares of SHAK.
(I will be buying some as a crazy trade only)
You and every other 'investor' who picks some up.
Damn that bacon cheeseburger looks good...
That's just the display model....not likely what you get when you go order one.
My neighbor photographs food for a living. The stuff she tells me she has to do to make that food look good would surprise you. For example, I guarantee you the char on that burger picture is actually ehnanced with some kind of paint or ladies make-up. She told me when she photographs a bowl of cereal, she uses white glue for the milk. And ice cream in pictures is never the real thing: it's either crisco shortening or mashed potatoes with food color.
It's pretty un-American to down vote a cheese burger.
I understand there are actually people out there that refuse to be omnivores as our ancestors have been for eons.
People called vegetable-arians or something.
Back to killin' snakes
America's bullshit economy.
America's fatso economy. Just think of all the food and healthcare expenses... AND supersized items- chairs, cars, rooms... It's enough to give Paul Krugman a boner.
MCD will become the new SEARS of fast food.
Shit Shack - Never heard of them before the IPO. Must be a Yankee kind of thing that only Wall Street traders like so they can go there and get a quick burger, then head to their spacious bathrooms to click their heels and play pitcher / catcher for the remainder of their "lunch" hour ...
^^^^^^^^^^^
gold!
Dirk your comment is almost 100% right but it's not "quick" as people wait on line for nearly 1 hour like lemmings with lobotomies.
That will go on until SHAK completes its overexpansion program which will place a store on every corner.
calpers will buy it. they'll buy anything.
Yep, exactly........thank god for that cheeseburger retirement income.
a bit much on the valuation but with Mcdonalds losing their edge with the younger generation, Shake Shack really makes a compelling case.
I gave my broker the OK to buy $100,000 of the Shak. .....I now own $100,000 on Radio Shak
I hear you can trade those shares for outdated smart-phone models at inflated prices.
'
'
'
Shak!?
I thought he retired from BB years ago?!?
•?•
V-V
Seasmoke
Good, good. Can't wait for you guys to update the Tandy computers. Mine is starting to get a little cranky.
You would think with a capitalisation well over one billion dollars the company could have easily afforded the, 'c', in, 'shack', eh?
So are the shares edible as well or is it just the burgers?
I believe the majority of their stores are in the ME.
Burgers Priest cloned them in Canada. Awesome burgers but at the end of the day...it's a hamburger.
Whether a burger made for the 1% will grow 20% forever depends on SP500....
Krispy Kreme traded like a tech company for awhile too...until it didn't.
Well, I won't take any stock. But one of those burgers would be nice. Now I'm hungry.
Me too. Guess I'm going to the local burger hole for lunch.
Cause Ronald McDonald needs a job!
Just what America needs, another feed yer fat ass burger joint.
This country is so fucked.
When these "markets" come tumbling down we're gonna see some real fucking head winds.
Keep your families safe guys.
Can't wait for the Fuck Shak IPO to cum.
Who owns you porn anyways? I'm sure America could get behind that IPO.....
Are they accepting EBT cards?
Crazy Town
Being an IT guy, I had a brilliant idea for a new tech company.
Create a very slick looking website with a simple account creation page. Upon creating your account, you get to register your bank account or pay pal account. The rules of the website are simple:
You can visit the website up to 10 times a day and each time you visit, you can click a button and have $100 deposited into your account.
I would expect with no advertising budget, monthly user count could easily hit 1 billion within a few weeks just via word of mouth.
I would think venture capitalists would be drooling over such as website. No earnings power, massive quarterly losses but massive user base.
Brilliant?
Our area is already loaded with 'boutique' burger joints.
White Castle forced to close in Vegas after first-day frenzy
A 24-hour White Castle location on the Las Vegas Strip that opened to long lines of the burger chain's fans had to close for more than two hours to restock after its grand opening.
http://www.cbsnews.com/news/las-vegas-white-castle-forced-to-close-after...
the whole point of these TOTALLY NONSENSE 'VALUATIONS'
is that at any given time companies can just choose not to sell their treasury shares and issued shares onto the open market. or they can use cash or debt to buy shares.
the share value is a manipulation game to SCALP whoever buys shares or options on the shares.
it has nothign to do with valuations. it's lies.
the whole point of these TOTALLY NONSENSE 'VALUATIONS'
is that at any given time companies can just choose not to sell their treasury shares and issued shares onto the open market. or they can use cash or debt to buy shares.
the share value is a manipulation game to SCALP whoever buys shares or options on the shares.
it has nothign to do with valuations. it's lies.
"The real American dream" having your burger and eat it to!
Who needs jobs and homes?!
Wall Street's IPO mania continues.
All the fund managers nudging each other in the IPO pig trough.
“I’ll pay you on Tuesday for a hamburger today.”
Come up with a catchy name and you too can IPO and get billions thrown at you.
It's the Pets.com time again.
Suck Sack....
'
'
'
63 Outlets.
1.84 Billion.
They're a ƒµç?¡?? burger joint. You sit outside!
Surely, a sign of the apocalypse.
In the future, we should grab the pundits and string'em up, the ones that will be nervously looking left and right, while pontificating as fast and as furiously as possible, how they knew this was the top of the bubble and these valuations were ridiculous, because the net, never fagets!
•?•
V-V
I am tempted to short this one, using leverage.
Do you think the market will remain irrational longer than I can remain solvent?
'
'
'
Beautiful!
I'm on the phone right now, telling my mother about this IPO and reading your comment to her!
She's howling!
•?•
V-V
Only thing going for the Federal Reserve are stocks.
They equate stocks with wealth. It's the only game they cling to now.
While the lower 90% sink into the abyss.
Nice plan Fed PhDs. Wait until the 90% come hammering on you door with pitch forks.
The barriers to entry in this sector are very high, after all.
You need beef, bread, cheese, a fryer, some soda machines...
Forget that!
Think it's time for me to open up EJ's Zerohedge Burger Cafe.
Who's in with me?
We are gonna be rich!!!!
Too many trolls in here that will pink slime you - you want flies with that?
Maybe they make their money with pay-toilets.
Aren't most IPOs just the big league version of OTC Penny Stock. pink sheet Pump and Dump?
I like my IPO's like I like my burgers: pink, over-priced, and smothered with smug.
All that liquidity has to go somewhere.
So if I put in an order for shares, they would have been filled at $47. With the stock trading at $49, I would have made $2.
The entire financial media will be proclaiming the stock IPO was a roaring success up 100%+.
I don't care what they claim the IPO price was. If the stock opened at $47, the initial public offering was $47.
Initial public fleecing. Insiders buy shares, use Fed funny money to bid up the stock on IPO day, laugh all the way to the bank making 100%+ profit in less than a second. Then when you complain they say you should buy stocks and make money. Yet when I buy, I don't get $21 per share, I pay $47. I don't make money, I give my money away. That is the way the stock market works.
Long burgers, short Treasuries.
Too close to lunch, that pic was just successful click bait.
Think of all the potential burger flipping jobs for our college graduates...
another purveyor of GMO frankenfood mystery meals for the plebes
Seeing this caused me to think one thing: "Follow the money, trace the Zionist strings."
Such an artificial valuation has to be related to some "connected," and or "Chosen" ones getting paid off on their way out of the near corpse of the DC US and petrodollar. I.e. it's a scam.
So I go here: https://en.wikipedia.org/wiki/Shake_Shack
Where I see this, "owned by the Union Square Hospitality Group (USHG)."
Which take me to this: https://en.wikipedia.org/wiki/Union_Square_Hospitality_Group
"Danny Meyer From Wikipedia, the free encyclopedia (Redirected from Union Square Hospitality Group)"Well, that was easy. Next.
The banksters need to repay us.
Louis Lunch - New Haven, Ct.
Birthplace of the hamburger sandwich.
Fantastic & original. Do NOT ask for ketchup.
Maybe they'll expand and sell SHAKE FRIES?
WOW! I can't wait to jump into the very next IPO of anything so I can make millions too! Ummm unless this whole thing was just a huge market manipulated scam to get me to jump into the very next IPO of anything thinking I'll make millions too.
After years of research, it has been shown that sniffing dog shit 3X a day prevents cancer. My company "Canine Anti-Cancer Crap" will roll out an IPO on Monday... Want to get in, early?.....This is a limited opportunity!....
Veganism is the future, so this will tank; definitely go for any IPO that does this whole veggie stuff, but make sure the IPO has a NO-CORPORATE-TAKEOVER-EVER clause, or for at least 10 years! No more Innocent smoothies bought by Coke please!
Reminds me of pets.com. Do they have a sock puppet?
And I thought Uber valued at $41B looked "rich"
http://i.imgur.com/PwXrP6q.jpg
Next big IPO will be for tulips
does the packaging double as a barf bag???
Sh*t Shak