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Jamba Ventures into New Markets

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Jamba Juice Company, a subsidiary of Jamba Inc. (JMBA), recently announced its entry into Missouri (MO) and Kansas (KS) markets in association with ShowMe Smoothie, LLC. Per the deal, 15 Jamba Juice stores will be launched over the next nine years. The terms of the deal were not disclosed.

Both the states have a promising restaurant industry. As per the National Restaurant Association, the restaurant sector in MO and KS is likely to generate around $8.8 and $3.7 billion of revenues for 2012, respectively.

Hence, these two Midwestern US states are deemed strategically apt for development. Kansas City, MO is also home to a peer of Jamba, Applebee’s International, a concept of DineEquity Inc. (DIN).

The development partner, ShowMe Smoothie, will also serve as a representative of JambaGo express smoothie units and smoothie station concepts in these two states.

Jamba Juice had more than 788 stores around the global, as of October 2, 2012 and the company is currently on an expansion spree. It has plans to open the new stores through both new and existing franchises.

In November last year, Jamba announced a massive expansion plan in its home state of California for the next six to seven years. The company’s Californian growth plans include the launch of up to 120 stores in more than 100 business areas and 25 mall locations across Northern, Central and Southern CA.

Jamba’s plan was to open 40–50 new stores in the U.S. locations and 15 new stores internationally in 2012. For 2013, the company plans to further speed up its development process by opening 60 to 80 U.S. and international stores.

Jamba, currently carries a Zacks Rank #3 (Hold). However, some restaurant companies which are expected to perform well, include Krispy Kreme Doughnuts Inc. (KKD) carrying a Zacks Rank #1 (Strong Buy) and AFC Enterprises Inc. (AFCE) carrying a Zacks Rank #2 (Buy).

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