Why is Shake Shack (SHAK) Considered a Promising Investment Option?

Choice Equities Capital Management, a hedge fund manager, released its third-quarter 2023 investor letter recently. You can view it here. In the third quarter, the fund generated -14.6% on a net basis which brought the year-to-date net performance to -6.2%. This compares to Russell 2000’s -5.1% loss for the quarter and +2.5% gain year-to-date. In addition, please check the fund’s top five holdings to know its best picks in 2023.

Choice Equities highlighted stocks like Shake Shack Inc. (NYSE:SHAK) in the third quarter 2023 investor letter. Headquartered in New York, New York, Shake Shack Inc. (NYSE:SHAK) owns and operates Shake Shack restaurants. On November 6, 2023, Shake Shack Inc. (NYSE:SHAK) stock closed at $57.13 per share. One-month return of Shake Shack Inc. (NYSE:SHAK) was 0.40%, and its shares gained 25.12% of their value over the last 52 weeks. Shake Shack Inc. (NYSE:SHAK) has a market capitalization of $2.417 billion.

Choice Equities made the following comment about Shake Shack Inc. (NYSE:SHAK) in its Q3 2023 investor letter:

“Shake Shack Inc. (NYSE:SHAK) – Shake Shack, Inc. is a company in which we have repurchased some shares as valuations in the restaurant space contracted this summer. As a business, the company has a number of things going for it, including a very strong brand with ample white space for store expansion. Additionally, the company has recently made significant strides in improving its store-level operating margins (SLOP). For the first time since before the pandemic, the company regained the 20% margin level after instituting several cost optimization measures. The improvement seems noteworthy as the company has managed to do so despite traffic remaining down nearly 40% at about half of its store locations (those with primarily urban footprints).”

A busy restaurant kitchen with a chef carefully plating a meal.

Shake Shack Inc. (NYSE:SHAK) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 24 hedge fund portfolios held Shake Shack Inc. (NYSE:SHAK) at the end of second quarter which was 22 in the previous quarter.

We discussed Shake Shack Inc. (NYSE:SHAK) in another article and shared the list of best fast-food stocks to invest in. In addition, please check out our hedge fund investor letters Q3 2023 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.