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The Jamba Juice Company was founded in 1990. The company was formerly known as Services Acquisition Corp. International, but in November 2006, it changed its name to Jamba Inc. (Johnson, 2016). It is based in San Francisco, California, and specializes in the production of blended drinks, snacks, and fruit smoothies. The company is classified as an Accommodation and Food Services business, according to the NAICS Code. However, the primary code – 722511 – indicates that it is a Full-Service Restaurant (NAICS Directory, 2017). Jamba Juice Company is a multinational firm with operations in Mexico, Canada, and South Korea, among other places. The main types of products offered by the firm include juice meals, fruit smoothies, sandwiches, and hot oatmeal. Though the company has been one of the best performing firms in the Accommodation and Food Services industry, it has been facing intense competition from other firms such as the Bravo Brio Restaurant Group Inc. Nevertheless, the firm’s performance has been quite commendable in the year 2017.
Figure 1: Jamba Juice Inc’s. performance in 2017. Image retrieved from http://www.nasdaq.com/symbol/jmba/stock-report
Boone, M. (2017). Analyzing Jamba (NASDAQ: JMBA) and its competitors. Stock News Times. Retrieved from https://stocknewstimes.com/2017/09/27/financial-survey-jamba-jmba-versus-its-peers.html
Boone argues that Jamba Inc. is one of the twenty-two firms that have been successful in trading in the ‘Quick Services Restaurants’ industry. According to the MarketBeat.com, the firm’s recommendations against its competitors and its ratings as well are as shown in the table below.
Figure 2: Jamba Inc’s ratings and recommendations against its competitors. Image location https://stocknewstimes.com/2017/09/27/financial-survey-jamba-jmba-versus-its-peers.html
Analysts point out that firms within the ‘Quick Services Restaurants’ have an 11.33% of growth. However, Jamba’s performance suggests that it growth aspects are less favorable than those of its rivals. An analysis on its valuation and earnings reveals that its competitors have a higher earnings and revenues, which makes it trade at a significantly lower price. By doing so, it makes its products moiré available in the market than those of its competitors. In relation to its volatility and risk, evidence suggests that it has a beta of 0.2, which denotes that the price of its shares is eighty percent volatile than that of its competitors (which has a beta of 0.53). In addition, 99.1% of its overall shares are owned by the institutional investors in comparison to 79.8% of all shares within the ‘Quick Services Restaurants’ industry that is held by institutional investors.
Business Wire. (2017). Jamba turning up the juice on competition, expands offerings with new organic, non-GMO cold pressed juice blends. Business Wire. Retrieved from http://www.businesswire.com/news/home/20150805005514/en/Jamba-Turning-Juice-Competition-Expands-Offerings-New
The article notes that Jamba Inc. has shown its commitment in diversifying its products by coming up with non-GMO ready-to-drink pressed juices. The new products would increase the varieties of juices the consumers can choose from, hence, guaranteeing customer satisfaction. The high pressure used in the manufacture of the juice guarantees the safety of the juices and also helps to preserve flavor and nutrients. The juices are bottled so as to enhance the convenience of the customers since they can carry their drinks whenever they go.
Jamba Juice. (2017). Fresh Juice, Fruit Smoothies, Energy Bowls & More | Jamba Juice. Retrieved from http://www.jambajuice.com/#
The official website of Jamba Juice Inc. shows the various kinds of juices offered by the firm and their nutritional value as well. One type of the juices offered is the mango juice, which is rich in fiber, vitamin A, potassium, and vitamin C. Another type of juice offered by the firm is pitaya juice, which is extracted from ‘dragon fruits.’ The juice provides the consumers with enough magnesium and fiber. Additionally, the company makes pumpkin seeds’ juice, which provides the consumer with iron and protein. The iron elements are important as they increase the rate of hemoglobin production and the red blood cells as well.
Johnson, M. (2016). Jamba Inc. misses earnings estimates, beats on revenue. TalkMarkets.com. Retrieved from http://www.talkmarkets.com/content/stocks--equities/jamba-inc-misses-earnings-estimates-beats-on-revenue?post=88617
Johnson notes that a report released by the Jamba, Inc. – about the firm’s earnings in the fourth quarter of the fiscal year 2015 - points out that it earned 19.5 million dollars but lost 0.28 dollars per share. Although Jamba, Inc. holds Zacks Rank #3, the position might change due to a number of issues brought out in the report. First, the company missed its earnings estimates by posting a loss of 0.28 dollars per share, which implied that it missed the $ -0.07 estimate by Zack. However, the value doses not factor in the $0.27 accrued from the non-recurring items. Secondly, the company’s revenue earnings surpassed the Zack’s estimates. Its total earnings were 19.5 million dollars while the Zack estimates were 18.4 million dollars. Thirdly, the rate of the comparable stores owned by the company declined by 5.4 percent in the fourth quarter even though the number of its system-wide increased by 3.9 percent. Fourthly, the company has expanded by establishing twenty-seven new stores globally. As at 29th December 2015, the total numbers of its stores all over the globe were as follows, seventy-five international stores, seventy company stores, and seven hundred and forty-eight franchise stores. Finally, the firms trading shares were significantly lower by 0/40% a few hours after it released its report on earnings. The company’s profit margin and net income are as illustrated in the graph below.
Graph 1: Jamba Inc’s. profit margin and quarterly net income. Image retrieved from http://www.talkmarkets.com/content/stocks--equities/jamba-inc-misses-earnings-estimates-beats-on-revenue?post=88617
Meyers, L. (2012). Strabucks declares war on Jumba Juice. Investor Place. Retrieved from https://investorplace.com/2012/03/starbucks-declares-war-on-jamba-juice/#.Wd57TFtSwdU
Meyers notes that Jamba Inc. would face more competition after Starbucks opens its own juice stores in the market. Starbuck’s entry into the market would be relatively easier since there are no restrictions that bar the entry of new firms into the market. Meyers is of the opinion that Jamba Inc. will be increasingly affected since it has been incurring a lot of losses due to decreased sales that arise as a result of the intense competition it has been facing in the market.
NAICS Directory. (2017). Jamba Juice - SIC & NAICS Code Business Information. Retrieved from https://siccode.com/en/business/jamba-juice-310
The site provides some vital information about Jamba Inc. According to the site, the firm’s primal role is the provision of food services and accommodation. The company has 5812 dining places and 722511 full-service restaurants. The organization’s headquarters are situated insane Diego, United States.
Nasdaq. (2017). Jamba, Inc. Competitors Nasdaq.com. Retrieved from http://www.nasdaq.com/symbol/jmba/competitors
The site provides an overview of the Jamba Inc’s. competitors and their market performances as well. For instance, the site depicts that the Jamba Juice Company’s shares were trading at $8.52 dollars on tenth October 2107, which represented a decrease of 0.24. Consequently, the trading price represented a 2.74% decline in the company’s shares’ value. According to the Nasdaq, the shares of the Bravo Brio Restaurant Group Inc. were trading at $2.40, representing an increase of 0.05.
The Value Investor. (2017). Jamba Juice – weather and competition concerns outweigh menu innovation. Seeking Alpha. Retrieved from https://seekingalpha.com/article/1932731-jamba-juice-weather-and-competition-concerns-outweigh-menu-innovation
The article notes that Jamba Juice has not been performing so well and its performance in 2014 was not promising to be a good year as well. Kurt Frederick – an analyst lowered the ratings of the firm from being an outperforming to a neutral one. Fredrick decreased the price target of the institution by two dollars, which fixed the price at thirteen dollars per share. According to Frederick, Jamba Inc. was not performing sufficiently as a result of adverse weather conditions and increased competitions. As a result, the firm’s sales have decreased by an estimated 3.4% in the third quarter of the year. Temperatures in most markets – for instance, California market – have been relatively low, which has decreased the consumers spending. In addition, the firm has not been carrying out promotions as it used to do in the previous years. Most of its competitors (for example, Robek’s Smoothie King and Tropical Smoothie Café) have been lowering their prices in order to increase their market base.
Wyatt, C. (2013). Jamba Juice and Krispy Kreme: Two takeover targets? Benzinga. Retrieved from https://www.benzinga.com/trading-ideas/long-ideas/13/01/3220495/jamba-juice-and-krispy-kreme-two-takeover-targets
Wyatt is of the opinion that Bloomberg sees Jamba Juice and Krispy Kreme as firms that are likely to experience a takeover since they have a strong clients’ appeal. Bloomberg claims that Starbuck is potential buyer of Jamba Juice Company. Even though Starbuck has laid out the plans to launch its own beverages, it might be forced to takeover Jamba Inc. in case its Evolution Fresh products do not attract the attention of the customers quite fast.
Zack Equity Research. (2015). Jamba juice to expand in Asia with 30 stores in Thailand. Zacks Investment Research. Retrieved from https://www.zacks.com/stock/news/181249/jamba-juice-to-expand-in-asia-with-30-stores-in-thailand
According to Zack Equity Research, Jamba Juice Company has succeeded in venturing into the international market after signing a development agreement plan with the King of Juices Company Ltd. Over the years, Jamba Juice Company will be at liberty to open thirty stores in Thailand, the first store was opened in 2015. As a result of the agreement, the company’s juice pipeline serves 545 stores that are located in Kuwait, Oman, Mexico, and Philippines among other nations. Nevertheless, the company remains optimistic that it is capable of opening at least 1500 stores. By signing the agreement, Jamba Juice Company seems to be relying on the skills of the King of Juices firm. The King of Juices company specializes in the production of beverages and food in Thailand, which implies that it has a lot of knowledge on the local market in Thailand. Jamba Juice Company has also heavily invested in franchising the its stores as a strategy of reducing its capital requirements while enhancing its return on equity (ROE) as well as increasing its earnings per share. In addition, the firm has also increased its rate of investments so as to enable the consumers recognize its brands, which has resulted in the growth of its cash flow. Such strategies have made the firm remain unaffected by inflation, which has adversely affected its rivals. The Zack Equity Research also notes that other firms like the Dunkin’s Brands Group, Inc. has also embraced franchisation as a main strategy of increasing its earn
Boone, M. (2017). Analyzing Jamba (NASDAQ: JMBA) and its competitors. Stock News Times. Retrieved on 10 October 2017, from, https://stocknewstimes.com/2017/09/27/financial-survey-jamba-jmba-versus-its-peers.html
Business Wire. (2017). Jamba turning up the juice on competition, expands offerings with new organic, non-GMO cold pressed juice blends. Business Wire. Retrieved on 10 October 2017, from, http://www.businesswire.com/news/home/20150805005514/en/Jamba-Turning-Juice-Competition-Expands-Offerings-New
Jamba Juice. (2017). Fresh Juice, Fruit Smoothies, Energy Bowls & More | Jamba Juice. Retrieved on 10 October 2017, from, http://www.jambajuice.com/#
Johnson, M. (2016). Jamba Inc. misses earnings estimates, beats on revenue. TalkMarkets.com. Retrieved on 10 October 2017, from, http://www.talkmarkets.com/content/stocks--equities/jamba-inc-misses-earnings-estimates-beats-on-revenue?post=88617
Meyers, L. (2012). Strabucks declares war on Jumba Juice. Investor Place. Retrieved on 10 October 2017, from, https://investorplace.com/2012/03/starbucks-declares-war-on-jamba-juice/#.Wd57TFtSwdU
NAICS Directory. (2017). Jamba Juice - SIC & NAICS Code Business Information. Retrieved on 10 October 2017, from, https://siccode.com/en/business/jamba-juice-310
Nasdaq. (2017). Jamba, Inc. Competitors Nasdaq.com. Retrieved on 10 October 2017, from, http://www.nasdaq.com/symbol/jmba/competitors
The Value Investor. (2017). Jamba Juice – weather and competition concerns outweigh menu innovation. Seeking Alpha. Retrieved on 10 October 2017, from, https://seekingalpha.com/article/1932731-jamba-juice-weather-and-competition-concerns-outweigh-menu-innovation
Wyatt, C. (2013). Jamba Juice and Krispy Kreme: Two takeover targets? Benzinga. Retrieved on 10 October 2017, from, https://www.benzinga.com/trading-ideas/long-ideas/13/01/3220495/jamba-juice-and-krispy-kreme-two-takeover-targets
Zack Equity Research. (2015). Jamba juice to expand in Asia with 30 stores in Thailand. Zacks Investment Research. Retrieved on 10 October 2017, from, https://www.zacks.com/stock/news/181249/jamba-juice-to-expand-in-asia-with-30-stores-in-thailand
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