What Is Right and/or Wrong with Steak N Shake?

[swmr1ml]

I still think the best thing about s n s was the curb service

[InLondon]

A Steak & Shake will be opening in May here. I thought it was a good restaurant. But maybe not?

[Southside Shrek]

This article questions whether or not Steak N Shake is dying.
If it ain't already dead, it sure as heck looks like it:


"We've also added the Altman Z-Score to predict the likelihood of
bankruptcy, but please note -- it's not designed to be used in every
situation, and there are some limitations to it. A company scoring
3.00 and above is considered safe; scores between 2.70 and 2.99 are in
the "yellow flag" zone; scores between 1.80 and 2.70 mean the chance
of going bankrupt within two years is good; and scores below 1.80 mean
"Watch out below!"

Here's today's list. The question is, are these companies only mostly
dead, or have they already given up the ghost?

Stock
Current Ratio
Acid-Test Ratio
Altman Z-Score

China Eastern Airlines (NYSE: CEA)
0.8
0.2
0.21

Finish Line (Nasdaq: FINL)
2.6
0.5
4.05

JB Hunt (Nasdaq: JBHT)
1.0
0.8
4.94*

OfficeMax (NYSE: OMX)
1.7
0.7
2.27

Steak n Shake (NYSE: SNS)
0.6
0.1
2.04


Sources: Motley Fool CAPS; Capital IQ, a division of Standard & Poor's.
*As of 12/31/07.

We obviously don't know whether these companies are headed six feet
under, so don't short them based on their appearance here. Even so,
stocks that CAPS investors have marked down to one star are possibly
destined to seriously underperform the market in the immediate future.

Shake, rattle, and rollover?
Somewhere between fish and fowl, Steak n Shake seeks to be a crossover
between fast food and casual dining. Unfortunately, it hasn't done any
better than any of its rivals, posting dismal second-quarter results
last month. That's led to a shakeup in the boardroom, where dissident
shareholders were elected to plant a stake in the heart of mediocrity.
But will a moribund economy still cause this company to roll over and
die? Top-rated CAPS All-Star Jeffreyw thinks it might be a
possibility, at least as far as Steak n Shake's stock price is
concerned:

PE of 34 for a fast food company in this economy is a bit too rich. I
don't see massive growth here, until consumers feel better about the
future (the whole consumer confidence thing.).

5 Deathbed Stocks

[zenderna]

used to love them in college... it was a huge treat. their burgers were like gourmet. but now you have places like Scotty's, Bub's, Red Robin with great and unique burgers...grilled buttered buns, Elk burgers, stuff like string onion rings, fried eggs or guacamole on them, etc, etc. Some nicer places even have Kobe beef burgers---didnt even Burger King come out with an Angus burger a while back? Has S&S changed it's burgers in 30 years?

Every once in a while I get a S&S burger or shake craving but do drive thru only. S&S interiors seem dismal and cold. the 50's diner thing has run its course. When you want to sit down for something casual, places like Chilis, Red Robin, Applebees at least seem a little more inviting and interesting, even though they're not my favorites

[Southside Shrek]

I believe Biglari is in over his head.

[domergurl]

Originally Posted by Southside Shrek

I believe Biglari is in over his head.

Don't think he thinks so ... we'll see what happens. I see a lot of store closings.

[Southside Shrek]

His head is bigger than the Atlantic Ocean. Now, if he can only figure out how to make a steak burger that size for $2.99, including fries and a shake.

[Naptowner]

I like the burgers, the skinny fries, and even the chili on occasion. And the shakes are good too.

But Steak and Shake has painted itself into a corner. Too expensive and slow for fast food, yet not quite good enough to get me in there to sit down for lunch or dinner.