Shake Shack is the IBD Stock Of The Day for Thursday. Its stock leapt on the rollout of AI-powered delivery robots.
Don't worry about tipping the driver, delivery robots are here. Shake Shack partnered with Serve Robotics, an autonomous sidewalk delivery company, to handle orders through Uber Technologies' Uber Eats app, according to a Wednesday announcement.
The rollout launched at select Shake Shack restaurants in Los Angeles Wednesday. The release did not mention plans for further Shake Shack expansion in the immediate future.
Uber Eats has offered Serve autonomous deliveries in LA since 2022. And Serve plans to deploy 2,000 robots to deliver Uber Eats orders across multiple U.S. markets by 2025.
Shack Shack Earnings Strong
Meanwhile, Shake Shack is coming off the back of a strong Q2 report. The New York-based burger chain on Aug. 1 reported a 50% increase in earnings on 16.4% revenue growth. Shake Shack's results matched FactSet earnings estimates and beat revenue forecasts.
Operating income more than doubled to $10.8 million. Restaurant-level profit came out to 22% of Shack sales. Same-store sales grew 4% for the quarter, topping estimates of 3.2% growth.
Shake Shack said its performance in the first half of the year puts it on track to reach its 2024 targets. The company guided expectations for a full-year revenue increase of 14% to 15%, to range from $1.24 billion to $1.25 billion. Shake Shack also expects to achieve positive free cash flow on the year for the first time since 2017.
Shake Shack Stock
SHAK stock rallied 4.9% Thursday to break out above a 105.68 buy point for a 15-week cup-with-handle base.
The current buy zone, which extends 5% beyond the buy point, stretches to 110.96.
Shake Shack was added as a half position on SwingTrader on Thursday as shares broke out.
Shake Shack has a 93 Composite Rating out of a best-possible 99. The Composite Rating combines various technical indicators into one easy-to-read score. Shares have a 79 EPS Rating. SHAK stock's relative strength line is trending toward 52-week highs and it has a 93 RS Rating.
Shares have rallied nearly 48% in 2024.
SERV stock pared gains to 0.6% Thursday after spiking 9.6% Wednesday.
UBER stock rose 1.1% Thursday, marking four consecutive daily gains. Uber is consolidating with an 82.14 buy point.
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