Shake Shack (Shake Shack) Interest Coverage : 9.96 (As of Dec. 2023)

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What is Shake Shack Interest Coverage?

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income by its Interest Expense. Shake Shack's Operating Income for the three months ended in Dec. 2023 was $5 Mil. Shake Shack's Interest Expense for the three months ended in Dec. 2023 was $-0 Mil. Shake Shack's interest coverage for the quarter that ended in Dec. 2023 was 9.96. The higher the ratio, the stronger the company's financial strength is.

The historical rank and industry rank for Shake Shack's Interest Coverage or its related term are showing as below:

SHAK' s Interest Coverage Range Over the Past 10 Years
Min: 16.4 Med: 26.79 Max: 99.89
Current: 16.4

SHAK's Interest Coverage is ranked better than
72.48% of 258 companies
in the Restaurants industry
Industry Median: 6.76 vs SHAK: 16.40

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

Shake Shack Interest Coverage Historical Data

The historical data trend for Shake Shack's Interest Coverage can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

Note: For Interest Coverage, "No debt" indicates no long-term debt. An indication of "No Debt" does not necessarily mean that the company has no long-term debt obligations; it could be due to missing data in the quarterly or annual report. Use caution when interpreting this information.

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Shake Shack Interest Coverage Chart

Shake Shack Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Interest Coverage

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96.48

16.40

Shake Shack Quarterly Data
	Mar19	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23
Interest Coverage	Get a 7-Day Free Trial															2.38	2.70	27.68	25.68	9.96

Competitive Comparison of Shake Shack's Interest Coverage

For the Restaurants subindustry, Shake Shack's Interest Coverage, along with its competitors' market caps and Interest Coverage data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

Shake Shack's Interest Coverage Distribution in the Restaurants Industry

For the Restaurants industry and Consumer Cyclical sector, Shake Shack's Interest Coverage distribution charts can be found below:

* The bar in red indicates where Shake Shack's Interest Coverage falls into.

Shake Shack Interest Coverage Calculation

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:

If Interest Expense is negative and Operating Income is positive, then

Interest Coverage

-1

Operating Income

Interest Expense

Else if Interest Expense is negative and Operating Income is negative, then

The company did not have earnings to cover the interest expense.

Else if Interest Expense is 0 and Long-Term Debt & Capital Lease Obligation is 0, then

The company had no debt ⁽¹⁾.

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

Shake Shack's Interest Coverage for the fiscal year that ended in Dec. 2023 is calculated as

Here, for the fiscal year that ended in Dec. 2023, Shake Shack's Interest Expense was $-2 Mil. Its Operating Income was $28 Mil. And its Long-Term Debt & Capital Lease Obligation was $719 Mil.

Interest Coverage	=	-1	*	Operating Income (A: Dec. 2023 )	/	Interest Expense (A: Dec. 2023 )
	=	-1	*	28.159	/	-1.717
	=	16.40

Shake Shack's Interest Coverage for the quarter that ended in Dec. 2023 is calculated as

Here, for the three months ended in Dec. 2023, Shake Shack's Interest Expense was $-0 Mil. Its Operating Income was $5 Mil. And its Long-Term Debt & Capital Lease Obligation was $719 Mil.

Interest Coverage	=	-1	*	Operating Income (Q: Dec. 2023 )	/	Interest Expense (Q: Dec. 2023 )
	=	-1	*	4.742	/	-0.476
	=	9.96

The higher the ratio, the stronger the company's Financial Strength is.

Shake Shack (NYSE:SHAK) Interest Coverage Explanation

Ben Graham requires that a company has a minimum interest coverage of 5 with the companies he invested. If the interest coverage is less than 2, the company is burdened by debt. Any business slow or recession may drag the company into a situation where it cannot pay the interest on its debt.

Interest Coverage is an important factor when GuruFocus ranks a company's overage Financial Strength .

Shake Shack Interest Coverage Related Terms

Thank you for viewing the detailed overview of Shake Shack's Interest Coverage provided by GuruFocus.com. Please click on the following links to see related term pages.

Shake Shack (Shake Shack) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Consumer Cyclical » Restaurants » Shake Shack Inc (NYSE:SHAK) » Definitions » Interest Coverage

Comparable Companies

Traded in Other Exchanges

SHAK:Mexico 9SH:Germany 9SH:Germany

Address

225 Varick Street, Suite 301, New York, NY, USA, 10014

Website

https://www.shakeshack.com

Shake Shack Inc is a roadside burger stands. It is serving a classic American menu of premium burgers, hot dogs, crispy chicken, frozen custard, crinkle-cut fries, shakes, beer, wine and more. The company's burgers are made with a whole-muscle blend of all-natural, hormone and antibiotic-free Angus beef, ground fresh daily, cooked to order and served on a non-genetically modified organism (GMO) potato bun. Its menu focuses on food and beverages, crafted from a range of classic American foods. The company serves draft Root Beer, seasonal freshly-squeezed lemonade, organic fresh brewed iced tea, cold brew coffee, organic apple juice, and Shack20 bottled water.

Executives

Jeffrey Flug	director	C/O PENNANTPARK INVESTMENT CORPORATION, 445 PARK AVENUE, 10TH FLOOR, NEW YORK NY 10022
Chapman Charles J Iii	director	1502 HUNTER DRIVE, WAYZATA MN 55391
Zach Koff	officer: Chief Operating Officer	C/O SHAKE SHACK INC., 24 UNION SQUARE EAST, 5TH FLOOR, NEW YORK NY 10003
Jeffrey D Lawrence	director	30 FRANK LLOYD WRIGHT DR, ANN ARBOR MI 48105
Lori George Billingsley	director	777 HIDDEN RIDGE, IRVING TX 75038
Daniel Harris Meyer	director	24 UNION SQUARE EAST, SIXTH FLOOR, NEW YORK NY 10003
Jenna Lyons	director	C/O J.CREW GROUP, INC., 770 BROADWAY, NEW YORK NY 10003
Katherine Irene Fogertey	officer: Chief Financial Officer	225 VARICK STREET, SUITE 301, NEW YORK NY 10014
Randall J Garutti	director, officer: Chief Executive Officer	C/O SHAKE SHACK INC., 24 UNION SQUARE EAST, 5TH FLOOR, NEW YORK NY 10003
Tara Comonte	officer: CHIEF FINANCIAL OFFICER	C/O SHAKE SHACK INC., 24 UNION SQUARE EAST,5TH FLOOR, NEW YORK NY 10003
Tristan Walker	director	330 WEST 34TH STREET, NEW YORK NY 10001
Robert T Vivian	director	C/O SHAKE SHACK INC., 24 UNION SQUARE EAST, 5TH FLOOR, NEW YORK NY 10003
Sumaiya Balbale	director	697 CALMAR AVENUE, OAKLAND CA 94610
Select Equity Group, L.p.	director, other: See Remarks	380 LAFAYETTE STREET, 6TH FLOOR, NEW YORK NY 10003
Green Equity Investors Vi, L.p.	director, 10 percent owner	11111 SANTA MONICA BOULEVARD, SUITE 2000, LOS ANGELES CA 90025