Shake Shack vs Wendy's
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KIRA’s take AI analyst
I put Shake Shack and Wendy's side by side, using each one’s latest annual report. Here is what stands out:
- Wendy's is the larger business, with $2.2B of revenue in fiscal 2025 against $1.4B for Shake Shack, about 1.5 times as much.
- Shake Shack grew revenue faster (15.4%, against −3.1%).
- Wendy's kept more of each dollar of sales as operating profit (15.8% operating margin, against 4.3%).
- Wendy's turned more of its sales into free cash flow (11.2% FCF margin, against 3.9%).
- Shake Shack earned a higher return on the capital invested in it (9.6%, against 7.8%).
- Investors pay more for each dollar of Shake Shack’s earnings: a P/E of 68.6x against 9.4x for Wendy's.
Who comes out ahead
Of the 9 measures where higher (or lower) is clearly better, how many each company leads.
Shake Shack
SHAK
5/9
Revenue growth5-year growthReturn on capitalPiotroski F-scoreNet debt / EBITDA
Wendy's
WEN
4/9
Operating marginNet marginFCF marginShare count change
Side by side
Best in the row
| Latest fiscal year | SHAK FY25 | WEN FY25 |
|---|---|---|
| Size | ||
| Market cap | $2.7B | $1.2B |
| Revenue | $1.4B | $2.2B |
| Free cash flow | $56.5M | $243M |
| Net income | $45.7M | $165M |
| Growth | ||
| Revenue growth | 15.4% | −3.1% |
| 5-year growth | 22.6% | 4.7% |
| Share count change | −5.3% | −5.6% |
| Profitability | ||
| Gross margin | — | 63.6% |
| Operating margin | 4.3% | 15.8% |
| Net margin | 3.2% | 7.6% |
| FCF margin | 3.9% | 11.2% |
| Return on capital | 9.6% | 7.8% |
| Return on equity | 9.2% | — |
| Balance sheet | ||
| Net debt | −$96.7M | $3.1B |
| Net debt / EBITDA | −0.6x | 6.3x |
| Dividends and buybacks | $0.0M | $330M |
| Valuation & quality | ||
| P/E | 68.6x | 9.4x |
| Piotroski F-score | 7 | 4 |
Ten years
Revenue
Operating margin
Free cash flow
Return on capital
Each company's latest fiscal year; fiscal years end in different months. The best value in each row is highlighted where higher (or lower) is clearly better. Not investment advice.