Fast-food restaurant operator Jack in the Box Inc. said Tuesday that it expects its fiscal second-quarter profit to meet the lower end of forecasts because of higher energy costs. Its stock fell 11%.
San Diego-based Jack in the Box said it will meet the lower end of its estimate for the quarter of 46 cents to 50 cents per share. The company is expected to earn 48 cents a share, the average estimate of six analysts surveyed by First Call/Thomson Financial.
Chief Executive Robert Nugent said at a Banc of America Securities conference that the company expects to meet the lower end of its annual earnings forecast of $2.20 to $2.30 a share.
Shares of Jack in the Box fell $3.42 to close at $26.69 on the New York Stock Exchange.
"California is clearly the problem for Jack in the Box and it could get worse later in the year," said Charles Weissman, a Bear, Stearns & Co. analyst who rates the shares "buy." "Most of their restaurants are company-owned, not franchised, so the company has direct exposure to higher energy costs."