You’ve seen the curly fries. You've probably seen the late-night commercials featuring a guy with a plastic ball for a head. But if you’re looking at Jack in the Box stock lately, things aren't exactly a party. Honestly, it’s been a rough ride for anyone holding these shares over the last year or two.
Back in late 2024, the stock was hovering near $50. Now? It’s a shadow of its former self, trading down over 50% since the start of 2025. When a stock drops that hard while the rest of the market is hitting record highs, you have to ask: is this a massive "buy the dip" opportunity for the 75th anniversary in 2026, or is the ship actually sinking?
The Del Taco Disaster and the Asset-Light Pivot
Management finally pulled the trigger on something investors had been begging for, or maybe fearing. They sold Del Taco. In late 2025, Jack in the Box reached a deal to offload the Mexican chain to Yadav Enterprises for about $115 million.
If that number sounds small, it's because it is.
Think about this: Jack in the Box bought Del Taco in 2022 for roughly $575 million. Selling it for $115 million just three years later is a massive "ouch." It’s basically admitting that the diversification strategy was a failure. But the new CEO, Lance Tucker, says this is all part of the "Jack on Track" plan. They want to be "asset-light." They want to focus on burgers.
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Essentially, they are trying to simplify a business that got too bloated. By January 2026, the deal officially closed, giving the company some much-needed cash—about $109 million upfront—to pay down their mountain of debt.
Why the Numbers Look Scary Right Now
If you look at the balance sheet for Jack in the Box stock, you might want to pour a drink first. The company is carrying about $1.7 billion in debt. Their debt-to-equity ratio is in the negatives because their total liabilities far outweigh their assets.
- Net Debt-to-EBITDA: It's sitting at roughly 6x. In the world of finance, that's like trying to run a marathon with a backpack full of bricks.
- The 2026 Maturity: There is a big chunk of debt—about $263 million—due in August 2026. This is the "final boss" for the company this year. They need to pay this down or refinance it at a time when lenders aren't exactly handing out cheap money to struggling fast-food chains.
- Store Closures: They aren't just selling brands; they are closing doors. Roughly 72 restaurants were shuttered by the end of 2025, and another 100 are on the chopping block for 2026.
It’s a "shrink to grow" strategy. It sounds good in a boardroom, but for a shareholder, it means watching revenue contract while hoping the remaining stores can carry the weight.
The California Wage Crisis
We can't talk about JACK without talking about California. A huge portion of their footprint is in the Golden State, where the AB1228 law pushed fast-food wages to $20 an hour in 2024, and then up to $21 in 2025.
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Labor costs spiked 200 basis points year-over-year. To cover the cost, they’ve had to hike prices. But there’s a limit. If a Jumbo Jack starts costing as much as a sit-down meal, people just stop coming. We saw this in Q4 2025 when same-store sales plummeted 7.4%. That’s not a dip; that’s a crater.
Is There a Case for a Comeback?
It isn't all doom and gloom, though. If you’re a contrarian, there are some crumbs of hope.
First, the dividend. Despite the carnage, the company is still paying out $0.44 per share quarterly. At current price levels, the forward dividend yield has ballooned to over 9%. That is massive. Usually, a yield that high is a warning sign that a cut is coming, but management seems determined to keep it for now to appease frustrated shareholders.
The 75th Anniversary Hail Mary
2026 is the 75th anniversary of the brand. They are leaning hard into nostalgia.
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- The Chicken Supreme is back. - Remodels: They are planning to refresh 1,000 restaurants by the end of the year.
- Tech Upgrades: They’ve partnered with a company called Qu to try and get digital sales up to 20%. They're even testing "Ready on Arrival" tech that uses geofencing to start cooking your food the second your phone gets near the parking lot.
Analyst sentiment is split. RBC Capital Markets actually raised their price target to $25 recently, calling it an "outperform." Meanwhile, UBS is more cautious, keeping a neutral rating and worrying about the "value equation."
Basically, Jack in the Box is trying to move away from being the "cheap" option to the "quality value" option. They’ve lowered the price on most combos to under $10 and boosted the size of their small drinks by 25%. They’re trying to win back the "heavy user"—the person who eats fast food three or four times a week.
Final Reality Check
Investing in Jack in the Box stock right now is a high-stakes gamble on a turnaround. You are betting that the Del Taco sale provides enough oxygen to survive the 2026 debt maturity and that the 75th-anniversary marketing push actually brings people back to the drive-thru.
The "Asset-Light" model is the goal. If they can successfully transition more company-owned stores to franchisees and keep those margins between 17% and 18%, the stock could double from these lows. But if wage inflation and debt interest keep eating the profits, it’s going to be a very long year for Jack.
Actionable Next Steps for Investors
- Watch the August Maturity: Keep a close eye on the company's filings regarding the $263 million note due in August 2026. Successful repayment or refinancing is the primary catalyst for any price recovery.
- Monitor Same-Store Sales (SSS): The company has guided for -1% to 1% SSS in 2026. If they miss this and stay deep in the negative, the dividend becomes at risk.
- Evaluate the "Barbell" Strategy: See if their $4.99 and $5 price points are driving traffic in your local area. Real-world "boots on the ground" observation is often faster than waiting for quarterly reports.
- Check Debt-to-Equity Trends: Use a tool like Simply Wall St or GuruFocus to see if the net leverage is actually coming down following the Del Taco divestiture.