Jersey Mike's Subs (JMKE) has visible same-store sales growth drivers for continued share gains, a long domestic store runway, and attractive franchisee returns, BofA Securities said in a note Monday.
The investment firm said the company has grown into a 99% franchised restaurant system with $4.2 billion of 2025 systemwide sales and 3,256 stores, but is still "well below" its long-term objectives of $2 million in average unit volume and more than 15,000 global units.
BofA noted that since 2018, Jersey Mike's has gained 713 basis points of market share in the limited-service restaurant sandwich category and 1,147 basis points in the fast-casual sandwich subsegment.
The company generated a 6.2% compound annual growth rate in same-store sales growth from 2006 through 2025, according to the note.
BofA said the company is "still in the early days of deploying a systematic approach to driving" same-store sales growth.
The note said the company previously relied heavily on linear TV and low-return-on-ad-spend sponsorships, which "drove high awareness but low conversion."
"Calls to action through menu news and messaging that highlights the menu's inherent value should drive trial," the note said.
The investment firm said that "consistent" average unit volumes across regions indicate the "portability of the concept," and "compelling unit economics" mean that there is "strong franchisee demand for new units."
BofA initiated coverage of Jersey Mike's with a buy rating and a $27 price target.
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