tag:blogger.com,1999:blog-5389144729834496735.post3464148369561682148..comments2024-03-17T05:15:55.634-04:00Comments on The Brooklyn Investor: Shake Shack Inc. (SHAK)Unknownnoreply@blogger.comBlogger24125tag:blogger.com,1999:blog-5389144729834496735.post-1781000812416259062018-03-05T13:24:29.742-05:002018-03-05T13:24:29.742-05:00I do follow them but don't really have any new...I do follow them but don't really have any new thoughts. They seem to be doing well. The street seems to be focusing a lot on same store sales, which is volatile due to how the NYC stores are heavily weighted etc... <br /><br />As for long term value, I haven't done any work on that, but maybe I will post an update one of these days... Price is a lot cheaper now than it used to be... kkhttps://www.blogger.com/profile/06299974418283948333noreply@blogger.comtag:blogger.com,1999:blog-5389144729834496735.post-21472621917756663282018-02-26T12:45:41.796-05:002018-02-26T12:45:41.796-05:00Wondering if you have updated thoughts on SHAK, gi...Wondering if you have updated thoughts on SHAK, given the operating/business progress since IPO and more attractive pricing? Thanks! Anonymoushttps://www.blogger.com/profile/04375589965848506087noreply@blogger.comtag:blogger.com,1999:blog-5389144729834496735.post-70521330964093675582015-02-09T14:25:09.759-05:002015-02-09T14:25:09.759-05:00Really enjoyed your analysis and writings on shak....Really enjoyed your analysis and writings on shak. As someone who rarely(read never)bets on the market,I did purchase shak- at an admittedly too high price (I knew it would tumble,and it has) but I'm not too worried- I'm buying for the long term and think a well run co. with good product will do very wellAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-5389144729834496735.post-89776733770492034342015-01-28T00:13:00.042-05:002015-01-28T00:13:00.042-05:00Good writeup. The space is too competitive for me ...Good writeup. The space is too competitive for me though, as I've followed Biglari and Steak N Shake for quite some time. <br /><br />And you don't have to lie, we all know that happy meal was for you...Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-5389144729834496735.post-26535982802149648032015-01-14T21:25:52.859-05:002015-01-14T21:25:52.859-05:00This is one of my favorite posts of yours ever. Th...This is one of my favorite posts of yours ever. Thanks so much for sharing your insights with the world. I, too, am a junk food junkie. If we ever meet up in Omaha or Brooklyn or somewhere, we'll have to do it over some fast food.Aaronnoreply@blogger.comtag:blogger.com,1999:blog-5389144729834496735.post-7965033266848987902015-01-14T02:26:46.075-05:002015-01-14T02:26:46.075-05:00Thanks for the follow-up and thank you for writing...Thanks for the follow-up and thank you for writing, your posts are really interesting!Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-5389144729834496735.post-26181450952323497782015-01-13T10:36:03.627-05:002015-01-13T10:36:03.627-05:00Hi,
I actually do own QSR. I guess that's a g...Hi,<br />I actually do own QSR. I guess that's a growth stock too. I forgot to mention it. I don't consider QSR a growth stock like SBUX, CMG etc. but more of a special situation. kkhttps://www.blogger.com/profile/06299974418283948333noreply@blogger.comtag:blogger.com,1999:blog-5389144729834496735.post-23429937063750539862015-01-13T03:06:10.582-05:002015-01-13T03:06:10.582-05:00Maybe a little bit of topic, but if valuations of ...Maybe a little bit of topic, but if valuations of these things are so high (someone mentionet 20 EV/EBITDA), why not invest in QSR instead? You would have 3G as an owner operator, Buffett, Ackman on board, already we know that company can grow global, is hi quality business model and with a proven track record. And it seems that their story is just beginning?Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-5389144729834496735.post-83510446023579849402015-01-10T18:26:10.969-05:002015-01-10T18:26:10.969-05:00Hi, sorry for the late response. I am mostly focu...Hi, sorry for the late response. I am mostly focused on long term now but if I see an interesting trade opportunity, I'll trade. But I want my long term investment decisions to be the primary determinant of my performance and trading p/l to be minor. <br /><br />kkhttps://www.blogger.com/profile/06299974418283948333noreply@blogger.comtag:blogger.com,1999:blog-5389144729834496735.post-11173986472357573152015-01-08T11:21:53.370-05:002015-01-08T11:21:53.370-05:00My thoughts on NDLS are the same. I think if someo...My thoughts on NDLS are the same. I think if someone used the broad model and tweaked it, something in that format could do well. I am kind of amazed at comments about certain companies being the next CMG. Just one visit to each will tell the difference. My first visit to a Chipoltle made me almost giddy and the spidey sense kicked in without even comparing the food to other places. I thought: they can churn so many dollars/customers through here so fast that no one can match or compare.<br /><br />Interesting about your background. Do you invest long-term or trade more now? <br /><br />jw Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-5389144729834496735.post-14062266802817715442015-01-07T16:24:59.643-05:002015-01-07T16:24:59.643-05:00Hi,
I did take a look at that, but the thing with...Hi, <br />I did take a look at that, but the thing with these food/retail companies is that it's really hard to judge without actually going to the stores/resturants (even though I would invest if there were other good enough reasons). So I have no idea about it. And the management there is recent so it's definitely not an owner/founder situation like CMG.<br /><br />kkhttps://www.blogger.com/profile/06299974418283948333noreply@blogger.comtag:blogger.com,1999:blog-5389144729834496735.post-73793245230521633932015-01-07T15:37:44.497-05:002015-01-07T15:37:44.497-05:00What do you think about LOCO? SHAK seems a lot bet...What do you think about LOCO? SHAK seems a lot better than that dud of a company which has been dressed up to be the next CMG, but with more than 20 years of operating history available, has gone no where with what's a weak USP (IMO).Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-5389144729834496735.post-83499106687104909242015-01-06T15:39:27.722-05:002015-01-06T15:39:27.722-05:00Hi,
Yeah, I agree it would be a great blog/twitt...Hi, <br /><br />Yeah, I agree it would be a great blog/twitter material. Kind of like the Onion, even, but for real, lol... (people will think it's a joke, but it's not!). <br /><br />I think NDLS is OK and might do well over time, but also definitely not another CMG. <br /><br />I have worked on the street for many years, but not in any conventional value fund or anything like that (mostly proprietary/trading oriented). kkhttps://www.blogger.com/profile/06299974418283948333noreply@blogger.comtag:blogger.com,1999:blog-5389144729834496735.post-90513923735663846072015-01-06T09:32:08.753-05:002015-01-06T09:32:08.753-05:00I figured you didn't eat this stuff all the ti...I figured you didn't eat this stuff all the time, but at least you admit to actually stepping foot in these establishments. I'm telling you, really high quality, foodie pictures and stories about dining experiences at these places would be funny. If you get a bunch of free time, you have to do it, if, for nothing else the contrarian angle.<br /><br />A point about Noodles. I actually think their serving model (order and they bring the food, they clean-up, no tip) has promise, but probably not with them. It appeals to people with kids, who don't want to do dishes (Panera), etc. If someone could get a very efficient ordering "system" going with decent food, I think the turnover could be increased and lead to some success.<br /><br />Not an institutional investor? You must have been previously, right?<br /><br />jwAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-5389144729834496735.post-59720615327406450592015-01-05T15:17:09.964-05:002015-01-05T15:17:09.964-05:00Hi,
I just started reading it and am enjoying it...Hi, <br /><br />I just started reading it and am enjoying it. kkhttps://www.blogger.com/profile/06299974418283948333noreply@blogger.comtag:blogger.com,1999:blog-5389144729834496735.post-56078802899942832632015-01-05T14:23:37.959-05:002015-01-05T14:23:37.959-05:00Hi KK,
Have you read Danny's book Setting the...Hi KK,<br /><br />Have you read Danny's book Setting the Table? I thought it was a great book that gave some good insights into the restaurant world. The things talked about are pretty applicable to business as well. Henryhttp://livingathome.weebly.comnoreply@blogger.comtag:blogger.com,1999:blog-5389144729834496735.post-64153599104946862392015-01-05T11:22:48.848-05:002015-01-05T11:22:48.848-05:00Hi,
Thanks for the comment. And that's a gre...Hi, <br />Thanks for the comment. And that's a great idea about twittering about food. I would love to make something contrary to what's usually out there in terms of food and wine. But that would be another time sink for me; I don't want to get involved with that... <br /><br />And by the way, most of the junk I eat is for lunch. I usually eat home-cooked for dinner (unless I'm on the road and there's nothing else; even I don't want to do MCD for dinner unless I have to!).or at an actual restaurant. The funny thing about restaurants is that nothing really beats cooking at home. <br /><br />Oh, and I am not currently an institutional investor. <br /><br />Thanks for dropping by! kkhttps://www.blogger.com/profile/06299974418283948333noreply@blogger.comtag:blogger.com,1999:blog-5389144729834496735.post-65036943104798627282015-01-05T09:34:33.039-05:002015-01-05T09:34:33.039-05:00A number of good things about this:
- Nice write-...A number of good things about this:<br /><br />- Nice write-up, as I didn't know much about SHAK, and will follow.<br />- Really good to read (for me) that someone else had about the same thesis for CMG as I did. In addition to what you mentioned, I remember reading about how popular CMG was with college kids. That made an impression on me because they were going to be eating out for a long time. Finally, I actually thought it was a good value at a few points. I looked at it on an expectations basis to see what I thought was implied in the price, and felt they were not too high and that it could outpace the implied growth rate I felt people were placing on the future.<br />- Finally, and the best thing about this write-up, is that you, as an institutional investor, identify yourself as a non-foodie, non-pretentious actual normal eater. The investors on twitter post more about food, wine, and what they are going to eat (all highfalutin stuff, mind you) than they do about investments. I really think you should take to twitter, anonymously of course, and start posting about your in-depth plans for dinner and then post a follow along with really high quality foodie type pictures of big macs and fries, etc. <br /><br />jw<br />Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-5389144729834496735.post-41084751284198584652015-01-04T16:11:52.317-05:002015-01-04T16:11:52.317-05:00Hi,
Yeah, CS is right there at the park.
And ye...Hi, <br />Yeah, CS is right there at the park. <br /><br />And yes, I was not very clear; I realized that after posting. I didn't mean that speed and throughput is a big factor at SHAK. It is at CMG, but SHAK is not like that. But there are other things at the SHAK that is definitely better than others and the price is still very reasonable.<br /><br />As for scalability, I think they should be able to scale. They say they can do 450 stores domestically, but who knows about these figures. Might be more, might be less. Don't forget, they started as a hot dog stand so they can probably come up with varying models for different sites (when they have to). As for the price range and quality, I think people were concerned about CMG's growth too as being more upscale than the other fast food and they grew fine. Their supply challenges were significant too (antibiotic free meats etc.). But they were able to do it. <br /><br />As for quality as they expand, you are right. This is always a risk. We shall see if they can maintain their standards over time. <br /><br />We'll see how it goes. <br /><br />kkhttps://www.blogger.com/profile/06299974418283948333noreply@blogger.comtag:blogger.com,1999:blog-5389144729834496735.post-19999261650549912552015-01-04T13:45:45.544-05:002015-01-04T13:45:45.544-05:00I too am a fast food fan and I'm not ashamed o...I too am a fast food fan and I'm not ashamed of it. Here are just a few observations:<br /><br />First - Amazing that Credit Suisse is not on the deal… the original Shake Shack is right there! What a slap in the face<br /><br />Second. SHAK is not really fast food.. Its throughput time is nothing like Chipotles - in my experience more like Noodles (from order to finish, not counting time waiting spent on line). The lines tells me there's a bit of brand prestige at work here - you certainly won't see people willing to wait 1 hour in line for Chipotle or McDonalds<br /> <br />Third. If you say the market positioning for SHAK is quality and a little bit of prestige, then the question is can this really be scalable, and is it really wise to for them to go for scale? Why should this company even be public? According to the S-1 they've had the same butcher for NYC, MidAtlantic and Northeast Shacks from the beginning. I imagine it'll be a hard finding a consistent source of quality meat supply as you expand. Already, in Manhattan I think some of the stores have slightly different quality ( the Grand Central one is not as good for example), and I think if they're going with licensing/franchising strategy abroad, quality will be even harder to sustain. <br /><br /><br />Finally, I agree the street will eat this up. This will easily trade at 20x EBITDA if not more. I think a fair price would be $500-600mm enterprise value, although people are already talking about $1bn valuation..<br />mspacey4415https://www.blogger.com/profile/11868322471454225634noreply@blogger.comtag:blogger.com,1999:blog-5389144729834496735.post-16858017402402053572015-01-04T10:57:24.822-05:002015-01-04T10:57:24.822-05:00Yeah, that's the way I view most of these rest...Yeah, that's the way I view most of these restaurateurs so it's no surprise you feel that way. I can only say that I have had good experiences with his productions and usually hear good things from others too. Of course, there is always some people that say he is overrated, overpriced etc... But I do think he runs quality operations. SHAK for sure is really well run and my experience there has always been really good. <br /><br />As for a relationship with Cramer, it doesn't matter. It's not a factor to me, unless he's getting food advice from him. If the advice is going the other way, who cares. <br /><br />And about eating in NYC, I agree. I tend to like local ethnic places (when I'm not at CMG or SHAK), and I am addicted to street cart food (mystery meat!), but don't get me started... <br />kkhttps://www.blogger.com/profile/06299974418283948333noreply@blogger.comtag:blogger.com,1999:blog-5389144729834496735.post-35099485955420291282015-01-04T10:53:22.613-05:002015-01-04T10:53:22.613-05:00I used to eat mostly junk food (especially in coll...I used to eat mostly junk food (especially in college) but now it's a much smaller percentage of my diet. My BMI is normal, blood pressure and cholesterol are low etc... <br /><br />Believe it or not, I do pay like Marion Nestle and I love Michael Pollan so it's not like I am a total fast food junkie. I do balance that with a lot of veggies and non-processed foods most of the time. <br />kkhttps://www.blogger.com/profile/06299974418283948333noreply@blogger.comtag:blogger.com,1999:blog-5389144729834496735.post-10779453816419100392015-01-04T10:18:23.181-05:002015-01-04T10:18:23.181-05:00REdanny Meyer..he's nothing more than a preten...REdanny Meyer..he's nothing more than a pretentious self promoting lesser known Bobby Flay wanna be.I remember when he opened the Union Square Cafe hoping to capitalize on it nearness to the farmers market,stealing a page off Alice Water's playbook. Plus he's chummy with snake oiled Cramer and helped him launch his cheap Mexican joint.He doesn't impress me at all.The trick to eating in NYC is finding the gems before the crowd and the NYTimes does. The tiny tapas bar on Elizabeth street opened by two very eager to please, authentic no bullshit, generous and talented Portuguese cooks who just landed in NY fresh off the streets of Albuferra.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-5389144729834496735.post-45191216479974655982015-01-04T10:05:08.621-05:002015-01-04T10:05:08.621-05:00Obviously you have a fast food obsession. No wonde...Obviously you have a fast food obsession. No wonder you don't post often.Ever put the fork down? I am long CMG HABT PNRA DRI CBRL and CAKE but would be caught dead in any of them. absolute garbage. Thinking about SHAK after the IPO frenzy subsides.Anonymousnoreply@blogger.com