Jack in the Box Inc.

Worth knowing

• Profit looks boosted by one-off gains. Reported profit is 2.4× operating cash profit (EBITDA), lifted by income outside the core business.Reported profit is 2.4× operating cash profit, lifted by income outside the core business.

  Jack in the Box's reported profit is 2.4× its operating cash profit (EBITDA), which is unusual: normally it's the other way round. Income outside the core business, such as interest on a large cash pile, gains on investments or asset sales, or tax items, has lifted net income, so its earnings-based valuation may look cheaper than the business alone justifies.Jack in the Box's reported profit is 2.4× its operating cash profit, which is unusual: normally it's the other way round. Income outside the core business, such as interest on a large cash pile, gains on investments or asset sales, or tax items, has lifted net income, so its earnings-based valuation may look cheaper than the business alone justifies.

• Negative shareholders' equity. Liabilities exceed assets on the balance sheet.

  Jack in the Box's liabilities exceed its assets on the balance sheet. Large share buybacks can cause this in healthy companies, but so can accumulated losses; either way, debt-based ratios need care.

• Returning more cash than it generates. Paid out $252M vs $207M of free cash flow over the 3 fiscal years to FY Sep 2025.

  Jack in the Box returned $252M to shareholders over three years, 122% of the free cash flow it produced. That gap has to be covered by cash reserves or new debt, which can't last indefinitely.

• Operating margin at a 6-year low. -1.2% in FY Sep 2025, the weakest of the last 6 years.

  Jack in the Box's operating margin fell to -1.2% in FY Sep 2025, its lowest in the 6 years of filings we have.