MW Jersey Mike's has picked a tough time for restaurants to go public
By Bill Peters
The sandwich shop has confidentially filed for an IPO, even as fast-food and sit-down chains are stuck in a discount war to win over inflation-fatigued consumers
Jersey Mike's is seeking a minimum $12 billion valuation, with plans to raise more than $1 billion, Bloomberg reported.
Jersey Mike's Subs on Monday said it had confidentially filed for an initial public offering, which could turn out to be one of the biggest restaurant IPOs in several years amid a difficult stretch for the industry.
The filing arrives as fast-food and sit-down chains alike remain locked in a discount war as they try to win over consumers, particularly lower-income ones, who have been turned off by price increases in the wake of the economic upheaval caused by the pandemic. Higher gas prices resulting from the Iran war have added to the pressure on consumers, although the direct impact of higher gas prices on restaurant spending remains a matter of debate.
JPMorgan and Morgan Stanley are working with the chain on the offering, Bloomberg reported this year. The media outlet said that Jersey Mike's is seeking a minimum $12 billion valuation, with plans to raise more than $1 billion.
That would make the Jersey Mike's IPO bigger than other recent restaurant IPOs. Fast-casual chain CAVA Group's $(CAVA)$ IPO in 2023 gave it a valuation of more than $2 billion. Drive-through coffee chain Dutch Bros (BROS) in 2021 landed a valuation of nearly $4 billion in its IPO. When Sweetgreen $(SG)$ set the terms for its IPO in 2021, estimates suggested it could have a valuation of up to $2.7 billion.
Jersey Mike's on Monday said it had confidentially submitted a draft registration statement with the Securities and Exchange Commission related to a proposed offering of its Class A common stock. The number of shares being offered and the price have not yet been set, the sandwich chain said.
Blackstone (BX) in 2024 agreed to acquire a majority stake in Jersey Mike's. According to an announcement from the investment firm at that time, the chain's roots go back to a sandwich shop founded in 1956 in Point Pleasant, N.J., called Mike's Subs. Jersey Mike's founder and CEO, Peter Cancro, began working there at age 14, bought the business in 1975 at age 17 and started franchising it in 1987. Jersey Mike's now has more than 3,000 restaurants in the U.S.
Jersey Mike's had sales of $309.8 million last year, a 10.6% gain, according to CNBC, which cited franchise disclosure documents. Its net income was $183.6 million last year, a decrease from $238.8 million in 2024, CNBC said.
Restaurant chains have been under pressure when it comes to foot traffic. Chipotle Mexican Grill's $(CMG)$ same-store forecast for the year was cautious, although the chain was upbeat about new menu items, including its new high-protein menu. McDonald's $(MCD)$ in February said its value meals were bringing back customers, but it expects 2026 to "remain challenging."
Heading into this year, Wall Street was betting that bigger tax refunds from the legislation known as the One Big Beautiful Bill Act, which was signed into law last year, would help boost consumer spending at retailers and restaurants. But some analysts on Monday said that industrywide discounting, a sign of weaker demand, would continue to be a theme throughout this year.
"We expect value and promotional activity will remain a key industry focus over the coming quarters as macro headwinds likely will continue to pressure consumer spending and sales &?traffic," UBS analysts said in a research note on Monday.
William Blair analyst Sharon Zackfia, in a note last week, said that historically, trends in gas prices haven't had much of an effect on restaurant sales, echoing remarks from other analysts. But she noted that higher prices for gas would hit lower-income customers harder overall.
"To that end, the spike in gas has largely obliterated any One Big Beautiful Bill (OBBB) restaurant stock trade related to higher tax refunds bolstering lower-income spending," she said.
-Bill Peters
This content was created by MarketWatch, which is operated by Dow Jones & Co. MarketWatch is published independently from Dow Jones Newswires and The Wall Street Journal.
(END) Dow Jones Newswires
April 20, 2026 14:18 ET (18:18 GMT)
Copyright (c) 2026 Dow Jones & Company, Inc.
Comments