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How Does Shake Shack's Valuation Compare to Other Publicly-Traded Chains?

Each Shake Shack location is worth $40 million.

Drew XXX/Flickr

Wall Street is going nuts for Shake Shack. Since Danny Meyer's NYC-born burger chain went public earlier this year, investors have pushed its stock valuation through the roof"Based on the number of locations open at the end of 2014, Shake Shack's current stock price values its restaurants at $40 million each," Reuters points out, four times the per-location valuation of Chipotle and nearly 15 times that of fast food behemoth McDonald's.

As McDonald's attempts to dig itself out of a major sales slump and figure out what those elusive millennials want, it's being forced to compete with "a growing appetite for 'fast-casual' restaurants catering to younger and more affluent diners willing to pay more for fresher, higher quality fare" — diners who are eagerly handing over their money to places like Chipotle and Shake Shack.

But can Shake Shack live up to lofty expectations set by its surging stock prices? Reuters says that while SHAK "is up 260 percent since it went public at the end of January," the sky-rocketing valuation "impl[ies] growth expectations that may prove hard for the management to deliver." Of course, it's worth noting that as Shake Shack expands, its per location value will diminish.

How does Shake Shack's current valuation per restaurant stack up to other publicly-traded chains? The graph below shows approximate per-location values for six major chains.

Editor's Note: The valuation numbers do not include a location's real estate value, sales projections, or other criteria for establishing more specific values. The per location value was calculated by dividing each company's total enterprise value by each chain's self-reported number of locations.

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