Contemporary ‘roadside’ burger stand company Shake Shack (SHAK) has been striving to expand its services across the country and strengthen its market position. However, the stock dipped nearly 7.8% in price yesterday after Northcoast Research downgraded its rating. So, considering the company’s weak fundamentals and lofty valuations, is the stock worth owning now? Read more to find out.New York City-based Shake Shack Inc . (NYSE:SHAK) owns, operates, and licenses Shake Shack restaurants in the United States and worldwide. Since the original Shack’s opening in 2004, the brand has expanded to more than 300 outlets in 32 U.S. states and more than 100 overseas locations. The company is continuing its efforts to redefine the industry landscape and deploy new technologies to fulfill the demands of consumers through strategic partnerships.
However, the stock has declined 31.5% in price over the past nine months and 6.4% over the past three months. Furthermore, closing yesterday’s trading session at $83.77, the stock is currently trading 39.5% below its 52-week high of $138.38, which it hit on January 27, 2021, indicating bearishness.
Also, following the company's failure to meet the consensus sales estimate in its recently released third-quarter results, and lower-than-expected projections, Northcoast Research downgraded the stock to Neutral from Buy yesterday, which contributed to a 7.8% price decline.