On Friday, Wall Street's buzz was about New York City based Shake Shack whose stock jumped nearly 120 percent on its first day of trading. The stock closed at $45.90 per share after it was initially offered at $21 per share. By selling 5 million shares the newest public company raised $105 million.
Shake Shack was started over 10 years ago, originally from a hot dog cart in Madison Square Park. The permanent stand served burgers, hot dogs, frozen custard, milk shakes, beer, wine and a number of other items. It is yet another company that fits into the fast-casual segments of restaurants similar to Chipotle and Panera. Shake Shack takes pride in being different from your Wendy's or McDonald's because it serves premium beef with a high degree of hospitality. The company currently has over 60 worldwide locations.
Investors are hoping that the one-time hot dog stand can continue to grow into the future, develop more product offerings and increase profitability. Only time will tell if this company's stock price can continue to sizzle. It is another example of how the fast-food industry has continued to evolve from a burger and fries.
Ethan Wade, Financial Advisor
(This article contains the current opinions of the author but not necessarily those of Brighton Securities Corp. The author's opinions are subject to change without notice. This blog post is for informational purposes only. Forecasts, estimates, and certain information contained herein should not be considered as investment advice or a recommendation of any particular security, strategy or investment product. References to specific securities and their issuers are for illustrative purposes only and are not intended and should not be interpreted as recommendations to purchase or sell such securities).