The Healthy and Active Lifestyle Take of Jamba, Inc. (JMBA)

Maui Wowi Franchising operates more than 600 franchised Maui Wowi Hawaiian locations serving several varieties and flavors of blended smoothies, coffee, espresso drinks and other snack beverages. The chain is made up of retail outlets in high-traffic areas, drive-thru locations and mobile carts.

Smoothie King Franchises is a chain (600 outlets) of franchise smoothie stands offering blended fruit and juice drinks. Available in 50 flavors, its drinks can be fortified with dietary supplements. Smoothie King stores also carry energy bars, sports drinks and sports nutrition items.


For Starbucks, the stake is the $50 billion world of health and wellness, made up of premium juices, vegan and veggie dishes that its Evolution Fresh stores will sell. Its target is well heeled customers other than those who patronize its gourmet coffee shops. Last month, when the company reported earnings, it reaffirmed its positive outlook for 2013.

Jamba’s priority is relatively low-end and school-centric locations. However, the entry of Starbucks and McDonald’s in the health drink segment has indirectly given Jamba, Inc. (NASDAQ:JMBA) the recognition that it badly needed. Jamba’s healthy and active lifestyle concept got yet another major boost from the developments in the caffeinated energy drink sector, which came under fire from regulatory authorities for higher than normal caffeine content.

The company’s initiative of moving an express and smaller version of its offering to non-traditional locations where healthy and quick serve are a necessary component of menus, such as K-12 schools and college campuses, has proved to be a hit. The company announced the opening of its 404th JambaGO location in January this year.

In 2013, Jamba plans to add 60-80 more stores to its existing 788-store chain and is targeting 1,000 JambaGo locations. The focus is on its healthy lifestyle brand while keeping a low key with consumer packaged goods sold through distributor relationships. There is nothing there to doubt that these will be met. The long term positive outlook on the stock is intact.

However, the stock has experienced a phenomenal rise in the last 5-6 months. Moreover, the company’s business remains primarily seasonal, indicating that earnings are likely to remain cyclical across the quarters as before. Although Jamba’s fiscal year 2012 earnings were in line with Street expectations, the stock fell 5.59% in afterhours (March 5, 2013) after the results were declared.

To me, this indicates that the stock is ready for a small correction in the coming days.

The article The Healthy and Active Lifestyle Take of Jamba originally appeared on and is written by Sujata Dutta.

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