Jack in the Box is doing its best to stay in the game.
As previously reported in April, the U.S. fast-food chain plans to close 10% of “underperforming” stores as part of a larger overhaul of the chain, which has been struggling as customers spend less.
At the time, the 75-year-old restaurant chain announced plans to cut 150 to 200 of its least profitable stores, many of which have been around for more than 30 years. In addition, the company said 80-120 restaurants will close by the end of 2025, while the remaining 200 restaurants will operate at a slower pace under franchise agreements.
Fast forward to now, and we’re at the end of 2025, and the company is full steam ahead with its “Jack on Track” strategy, a financial restructuring plan designed to save the restaurant chain.
The burger chain will use proceeds from the sale of its Del Taco brand for $115 million.
“Our actions today are focused on three primary areas: addressing our balance sheet to accelerate cash flow and pay down debt while retaining growth-oriented capital investments related to technology and restaurant reinvention; closing underperforming restaurants to achieve continued net unit growth and competitive unit economics; and, an overall return to simplicity in the Jack in the Box business model and investor story,” Jack in the Box CEO Lance Tucker said in a release.
According to the plan outlined in the press release, closing underperforming stores is an important part of this initiative and is consistent with the goals the burger chain is trying to achieve.
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Jack in the Box plans to implement a neighborhood closing program that could close 150-200 underperforming restaurants.
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The plan is to close 80-120 restaurants between now and December 31, with the remaining underperforming restaurants closing based on franchise agreement termination dates.
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It excludes the 1.5% to 2.0% of system units expected to close in fiscal 2025, and the 1% of system units expected to close annually starting next year.
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Once completed, Jack in the Box targets continued, positive net growth supported by strong performance in new markets and other opening opportunities.
But do experts think Jack in the Box can achieve such a feat with their turnaround strategy? According to TheStreet, the final outcome of the matter seems doubtful.
“TD Cowen has lowered its Jack in the Box price target to $16 from $21 while maintaining a Hold rating on the fast-food chain’s stock. The new target is slightly higher than the stock’s current price of $14.38 and just 1% above its 52-week low of $13.99.
Investing.com reports: “TD Cowen cut its price target after citing a ‘tough end to fiscal 2025’ for the company. The company is in the early stages of implementing its ‘Jack on Track’ turnaround plan amid a challenging industry environment. The stock has plunged nearly 68% in the past year, significantly underperforming the broader market, according to InvestingPro data.”
But when it comes to expectations and valuations for the burger chain, there’s a huge gap between the two. However, this depends on the analyst.
“The consensus price target for Jack in the Box Inc. is $29.7, based on ratings from 21 analysts. The highest price is $73, published by B of A Securities on October 22, 2024. The lowest price is $15, published by Barclays on November 20, 2025. The most recent 3 analyst ratings are by Piper Sandler, Citigroup, and Barclays, published on November 21, 2025. Benzinga According to the report, the average target prices of Piper Sandler, Citigroup and Barclays are 2025 and November 20, 2025 respectively, so the latest rating of Jack in the Box Inc. implies a downside of -20.58%.
While debt reduction remains a top priority and the Del Taco spinoff is complete, Jack in the Box still faces challenges such as weak sales trends, pressure on financial performance and tight margins.
Read the original article at pennlive.com.