Fast casual food chain Jersey Mike’s Subs Inc. (NASDAQ:JMKE)’s shares are up by 3% since the closing price of their IPO in July. The company is a franchise food operator that operates in the fast casual submarine sandwich sector. Cramer discussed Jersey Mike’s Subs Inc. (NASDAQ:JMKE) on August 24th and was optimistic about its CEO and his approach to franchising:
“Okay so we talked about a 5 trillion dollar company before the break, NVIDIA, and that’s the most important company in the world. Far less important, seven billion dollar company, is Jersey Mike. But Jersey Mike, which came public in ’23, is now doing better. This is a universally loved stock today. Now why. Because it’s got a pure franchise model, real easy to understand, not unlike YUM. It’s got no international exposure. International could be the next leg. They have 3,300 stores. They’re committed to having 1,600 more. Charlie Morrison’s running it. People remember him from when he took Wingstop to heights you wouldn’t believe. I had lunch with Charlie, I think he’s got a real clear head about what to do with this. Charlie makes it Charlie’s brilliant, and here’s what he says. I said, listen, let’s say I want a Jersey Mike, I want, one of their stores. Well, he says okay show me how you’ve done at all the other franchises you’ve had. And you’ll say well I haven’t done any. Then he says, I’m not interested in you at all. I’m only going to support guys who really know how to do this. Maybe have two to three Burger Kings, or three to four McDonald’s. Then you’ll get a Jersey Mike. That’s how he’s going to instill quality. That has not been the case. They’re going to do quality control, and they’re going to do international. And I think the stock’s going to go up substantially. And it ain’t got no stinking data center risk.”
As Jersey Mike’s Subs Inc. (NASDAQ:JMKE) is a fresh addition to the stock market, little data is available to analyze the firm’s prospects in detail. For its fiscal year 2025, the firm reported $724 million in revenue, $55 million in net income and 3% in same-store sales growth. The financial figures, coupled with $1 billion in IPO capital raise meant that Jersey Mike’s Subs Inc. (NASDAQ:JMKE) was among the top IPOs in its sector in quite a while. Not to mention, the restaurant ranked 1st in the American Customer Satisfaction Index (ASCI) in the quick service restaurant category for 2026. Seems like the CEO’s focus on quality, which Cramer alluded to, has served it well in driving customer satisfaction.
Yet, with the restaurant sector as a whole struggling with growth, the fact that the $1 billion in proceeds went towards debt servicing could leave Jersey Mike’s Subs Inc. (NASDAQ:JMKE) with little room to navigate inflationary headwinds. Not to mention, the valuation is also quite rich. Jersey Mike’s Subs Inc. (NASDAQ:JMKE) trades at an enterprise value to EBITDA multiple of 36.68, which is higher than peer firms’ Yum Brands’ 18.40 and McDonald’s 16.15. These multiples could leave little room for execution risk – a fact that also appears to be on the CEO’s mind, considering Cramer’s discussions.
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Disclosure: None.
