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Jack in the Box Up on Approval of Additional Share Buyback

Share price of Jack in the Box Inc.JACK went up 1.3% to $75.01 in aftermarket hours on Sep 21 after its board of directors authorized an additional $200 million stock buyback program. This new buyback program will commence in fiscal 2016 and expire in Nov 2017.

In fiscal 2015, this fast food company repurchased shares worth $317.1 million including $65.5 million in the fiscal fourth quarter. With this share repurchase, the company utilized the share repurchase authorization of $100 million announced in May 2015 and set to expire in Nov 2016. Jack in the Box has been regularly boosting shareholders' value through share buybacks. The company has repurchased shares worth $319.7 million, $140.1 million and $29.5 million in fiscal 2014, 2013 and 2012, respectively.

We would like to remind investors that the company has not been returning shareholders wealth only through share buybacks. The company also initiated a dividend program in fiscal third quarter 2014 and has been regularly paying dividends since then. Moreover, it increased its dividend by 50% in May 2015. We appreciate Jack in the Box's efforts to consistently enhance shareholder returns, amid the challenges in the economy.

However, Jack in the Box is not the only company in the restaurant space to reward its shareholders. Another sector behemoth, McDonald's Corp. MCD has a history of increasing dividends every year since the inception of its dividend payout program in 1976. Brinker International, Inc. EAT recently announced its fifth consecutive dividend increase since it began paying quarterly dividends in Nov 2010. Both have also been repurchasing shares.

Jack in the Box presently has a Zacks Rank #2 (Buy). Investors interested in the space may consider Bob Evans Farms, Inc. BOBE , sporting a Zacks Rank #1 (Strong Buy).

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MCDONALDS CORP (MCD): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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