Jack in the Box
This top fast-food offering for investors to consider also has zero Chinese exposure. Jack in the Box Inc. (NASDAQ: JACK) operates and franchises Jack in the Box restaurants, one of the nation’s largest hamburger chains, with more than 2,200 restaurants in 21 states and Guam. Additionally, through a wholly owned subsidiary, the company operates and franchises Qdoba Mexican Eats, a leader in fast-casual dining, with more than 600 restaurants in 47 states, the District of Columbia and Canada.
The fast-food restaurant chain operator said that for its second quarter it brought in net income of $25.1 million, which amounted to $0.96 per share. On an adjusted basis, when considering restructuring costs and taking into account discontinued operations, the business brought in earnings of $0.99 per share.
Jack in the Box shareholders are paid a 2.08% dividend. The $94 Merrill Lynch price objective compares with the $91 consensus target price. The stock closed most recently at $83.20 per share.
This top grocer does almost all of its business in the United States. Kroger Co. (NYSE: KR) is the second largest U.S. food supermarket retailer and generates $120 billion in annual sales. Kroger operates roughly 2,800 supermarkets throughout 35 states and under two dozen banners. Kroger also sells fuel at 1,450 supermarket fuel centers and operates 2,268 pharmacies and 274 jewelry stores.
The stock remains very cheap, as the company has a market cap of under $19 billion. The shares were nailed back in March when the company reported weak first-quarter results. While it is slowly recovering, the sell-off is still giving investors a great entry point.
Kroger shareholders receive a 2.48% dividend. Merrill Lynch has set its price target at $29. The analysts’ consensus target is $28.17, and the shares closed most recently at $22.81.
While the rhetoric from China has escalated, the inescapable fact is that China exports far more to the United States on a dollar basis than the other way around, and eventually some sort of accord will be reached.
The newer tariffs that potentially will be imposed on Mexico are related more to the border crisis, and the country’s seemingly unwillingness to stop migrants from coming through their country to the United States. It is likely the government of Mexico will look to strengthen border security to avoid the potential upcoming tariff on all goods, and representatives already are in the United States looking for a solution.
The China trade issues remain a bigger threat, but it behooves both of the great powers to get a deal done, as slowing worldwide growth doesn’t need trade wars to slow things down even more.