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Jack in the Box Inc. Message Board

  • samelladerrig samelladerrig Nov 11, 2011 11:49 AM Flag

    JACK - 2 Tasty Metrics for Jack in the Box

    JACK: 2 Tasty Metrics for Jack in the Box

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    • Not really meaningful. Motley Fool rarely publishes anything of real value. The only "metrics" you really need to know are these: JACK has enormous hidden value in it's irreplaceable real estate holdings, it has a non-shareholder friendly management that is ripe for an activist investor's impact and, most importantly, it has an incredible asset in Qdoba that current management has no ability or interest or knowledge how to monetize. That's all you need to know. Great story and ultimately, it will be recognized in the marketplace. But, until then, you wait, and wait and wait......

      • 1 Reply to pmoishe
      • Hussman took at decent position, but he is not an activist.

        I wouldn't be surprised if a number of IB firms were trying to win the banking on the spin-off. I would like to see this succeed, I have yet to take a position, because I don't see a catalyst for the monetization of Qdba.

        Think about this, they could sell thier real estate holdings to a REIT (which would be fully leveraged by the proceeds of the QBDA sale/spin off keeping it as a current shareholder asset), say JBX Properties and that company could produce a decent FFO and pay a great yeild. They would also spin off 75% of Qdba to shareholders and leave the REIT with a 25% stake that would allow leverage for the purchase of the real estate. The existing Jack in the box would retian all franchises, but have not a single peice of real state that is owned by the company. The cash flow generated from the franchisees would have to justify keeping the locations open or closing them. They could also JV the QDBA/JACK to maximize on existing franchise real estate, similar to what Tricon (later named YUM barnds) global did back in the early 2000s. It would be a slamd dunk, the IB'ing would get paid, the shareholders would have a choice of what assets they wanted to own and ultimately the mng't would have to live within their means and base decisions on the EBITDA of each business.

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