02:39 PM EDT, 06/26/2025 (MT Newswires) -- Shake Shack ( SHAK ) is poised for positive revisions to its core earnings through 2026 as its outlook for this year could prove conservative, Oppenheimer said in a note e-mailed Thursday.

Last month, the burger chain said it expected 2025 adjusted earnings before interest, taxes, depreciation, and amortization of $205 million to $215 million. The outlook factored in low-single-digit same-store sales growth and roughly 23% restaurant margins, according to Oppenheimer.

"We believe this could prove conservative as Shack-specific drivers appear impactful, with velocity to accelerate in more stable macro," Oppenheimer analysts Michael Tamas and Brian Bittner said in a note to clients. "We believe the stage is set for positive (adjusted) EBITDA revisions through (2026)."

The brokerage raised its price target on the Shake Shack ( SHAK ) stock to $160 from $125, with an outperform rating. The company's shares were up 3% in Thursday late-afternoon trade.

"Despite macro uncertainties, we remain focused on creating durable value for all our stakeholders through initiatives to drive same-Shack sales including strengthening our culinary and calendar strategy and driving frequency," the company said in a shareholder letter in May. "We are optimizing our operations, opening new Shacks with excellence at lower build costs, and growing our licensed business."

Oppenheimer increased its adjusted EBITDA estimates to $214.6 million from $212.8 million for 2025, and to $250.6 million from $249.7 million for 2026. Wall Street is looking for $214 million and $247.4 million, respectively, according to the note.

"We are bullish on (Shake Shack's ( SHAK )) strengthening unit economics and exponential expansion potential," the analysts said. "As the company benefits from a more professionalized strategic approach, we've identified attractive upside potential to sales and margins in the near-term, and unit growth dynamics in the long-term."

For the second quarter, Oppenheimer projects same-store sales growth at 1.8%, which it said was above the Street's view of 1.5% increase.

Price: 137.28, Change: +3.38, Percent Change: +2.52