A stronger-than-expected first-quarter earnings beat and an updated full-year outlook sent Shake Shack shares soaring on Friday.
The results help ease fears that the company’s aggressive expansion plans would hurt sales at its existing stores. The company expects to add 32 to 35 U.S. company-owned stores this year.
The burger joint, which reported its earnings on Thursday, saw its stock jump more than 22 percent as sales at its restaurants improved in the quarter. In the past year, the stock has climbed more than 76 percent.
Same-store sales rose 1.7 percent due to higher menu prices, which bolstered the average ticket, the company said. Sales at established stores had been expected to fall 0.4 percent during the quarter, according to StreetAccount.
“This increase consisted of a 5.9 percent increase in price and mix, including the 1.5 to 2 percent price [hike] that we took in December, partially offset by a 4.2 percent decrease in traffic,” Tara Comonte, chief financial officer at Shake Shack, said on the earnings conference call Thursday.
Shake Shack declined to say what share of its sales came from digital orders. However, CEO Randy Garutti said the size of the average digital order is 15 percent higher than regular sales. Digital orders and delivery service additions helped its first-quarter performance.
Shake Shack said that, on average, its company-operated stores earned $81,000 a week during the first quarter, down 6 percent from its weekly sales in the same period a year ago.
The burger chain said that it now expects same-store sales to be flat to up 1 percent for the full year, higher than its previous forecast of flat same-store sales growth.
In addition, the company said it foresees full year revenue to be between $446 million and $450 million, up from the $444 million to $448 million it had predicted last quarter.
The company said that net income rose to $3.5 million, or 13 cents per share, up from $2.3 million, or 9 cents per share, for the same period last year.
Excluding items, it earned 15 cents per share, exceeding the 8 cents per share analysts had expected, according to Thomson Reuters.
Revenue for the quarter was $99.1 million, up from $76.7 million last year and ahead of the $96.7 million that was projected by Wall Street.