Join

Enter Details

Comment on stories, receive email newsletters & alerts.

@
This is your permanent identity for Business Insider Australia
Your email must be valid for account activation
Minimum of 8 standard keyboard characters

Subscribe

Email newsletters but will contain a brief summary of our top stories and news alerts.

Forgotten Password

Enter Details


Back to log in

Each Shake Shack restaurant is worth a ridiculous amount of money

Shake Shack’s shares keep rising as the company announces plans to open more restuarants.

But each Shake Shack location is worth a ridiculous amount of money, notes Brody Micolucci on StockTwits.

He shared a chart from ZeroHedge which shows the company’s share value divided by number of restaurants.

A single Shake Shack is worth nearly $US50 million. That compares with about $US10 million for Chipotle, and $US3 million for McDonald’s.

Shake Shack currently has 63 locations, though it has plans to open hundreds more. The company’s market cap is $US3.42 billion.

$USSHAK Ridiculous…
— Brody Micolucci (@BrodyMicolucci) May. 21 at 01:12 PM

Shake Shack’s high-quality, ethically sourced food and excellent customer service have drawn many comparisons to Chipotle.

But the brand probably won’t become as ubiquitous as the famous burrito chain.

“Shake Shack will certainly have its success,” Brian Sozzi, chief equities strategist at Belus Capital Advisors, told Business Insider. “But the brand enters an industry chock full of better burger businesses and chains doing healthier fast food, such as Chipotle.”

Fast food powerhouses like Starbucks, McDonald’s, and Chipotle offer customers fundamentally different experiences, Sozzi says.

“Starbucks created premium coffee, McDonald’s arguably created the burger and french fry,” he says. “Chipotle was the anti-Taco Bell and was transparent about ingredients.”

While Shake Shack’s food has a cult following, it faces steep competition.

NOW WATCH: Victoria’s Secret is making one mistake that is driving away a lot of women

NOW WATCH: Briefing videos

Business Insider Emails & Alerts

Site highlights each day to your inbox.

Follow Business Insider Australia on Facebook, Twitter, LinkedIn, and Instagram.