Sonic Corp. (NASDAQ: SONC) continues to expand its franchise footprint across perhaps one of the largest markets in the United States. The company announced the expansion of two existing franchise agreements and the addition of two new franchise agreements for a total of 33 new drive-ins to California over the next seven years.
The 33 drive-ins are planned for multiple markets across the state: 11 in Sacramento, 12 in the San Francisco Bay Area, three in west Los Angeles, five between Bakersfield and Stockton, and two in the Palm Springs area.
All planned drive-ins are expected to be serving customers by 2022, bringing over 1,500 new jobs to the state over seven years. There are currently 68 open drive-ins operating in California, and this announcement would bring the total of upcoming drive-ins to 101.
John Budd, chief development and strategy officer for Sonic, commented:
As a franchise-centric brand with more than 60 years of heritage, Sonic is a smart choice for motivated entrepreneurs interested in building a business with an established, respected brand. These new and existing partners in California represent some of the best in the business, with a great deal of restaurant and multi-unit experience. As we continue to seek qualified partners for the Sonic brand and in the state, these franchisees will exemplify the kind of success that comes from bringing Sonic Drive-In to previously underserved markets.
Drew Ritger, senior vice president of development for Sonic, added:
The expanding presence of the SONIC brand in California has been quite a success story in the past few years. The consumer demand – fueled by our national marketing campaign and the Two Guys commercials – is extremely strong in the state, and many franchise opportunities still exist for new and existing partners in Sacramento, the East Bay Area, west Lost Angeles and the Santa Barbara and Ventura counties.
Shares of Sonic were down 2.2% to $31.59 Monday morning, with a consensus analyst price target of $33.23 and a 52-week trading range of $22.72 to $36.73.