), a highly recognized healthy, active lifestyle brand, recently
announced the opening of a new franchised store in the Minneapolis
area. The newly opened store marked the company's eighth in the
The Emeryville, California-based company stated that the new
store has been opened on Level 3 of the Mall of America in
Bloomington. The Mall of America is the second largest mall in
North America and offers a full range of retail, restaurant and
entertainment for its shoppers. This new store is expected to
benefit immensely from its strategic positioning. The shopping
center attracts approximately 40 million visitors annually from all
the nearby locations.
We believe that the new store opening is in line with the
company's expansion strategy through franchising. We believe that
Jamba's transition to a more franchise-centric model will involve
less capital and stabilize cash flow generation.
Jamba Juice, which currently operates more than 760 stores, will
continue to focus on expansion and expects to sign more franchise
agreements in 2012 that will expand its brand presence in two to
three new markets in the US. For 2012, Jamba plans to open 40-50
new stores in U.S. locations and 10-15 new stores
We are impressed with Jamba's slow-but-steady turnaround.
Besides the domestic market, Jamba is also in an expansion mode
overseas. The countries that Jamba is currently eyeing are Korea,
the Philippines and Canada.
The company is also on track to innovate a new beverage line and
a value-based menu offering. Its recent deal with Bare Fruit LLC to
produce three varieties of fruit chip snacks will hit the market by
the end of fiscal year 2011.
For fiscal 2011, management expects comparable store sales in
the range of 2% to 4% and operating margin between 18% and 20%. For
fiscal 2012, Jamba foresees company-owned comparable store sales
growth of 3-4% and adjusted operating margin in the range of
19-22%. Jamba currently retains a Zacks #3 Rank (short-term Hold
rating). We are also maintaining our long-term Neutral
recommendation on the stock.
JAMBA INC (
): Free Stock Analysis Report
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