Morgan Stanley (NYSE:MS) and JPMorgan Chase & Co. (NYSE:JPM) Will Be the Underwriters of Shake Shack

On Thursday, sources familiar with the matter said that Shake Shack, a fast food company that has built quite a reputation due to its enormous shakes, flat top hotdogs and shackburgers, plans on going public. Sources further added that the restaurant chain has hired the services of Morgan Stanley (NYSE:MS) and JPMorgan Chase & Co. (NYSE:JPM) to advise it on its financial options and plans.

If Shake Shack goes public successfully, then it will be the biggest event in the 10 year long history of the company. People familiar with the situation said that the company plans on going public by the end of the year 2014.

Rumors have it Shake Shack will post total earnings of $20 million for the next year. Moreover, the company, in its first IPO, is expected to offer a small number of shares to the public.

JPMorgan and Morgan Stanley have been given the task of underwriting one of the biggest names in the burger industry.

Last week, the majority owner of Shake Shack, Union Square Hospitality Group LLC, held meetings with a number of investment agencies, in order to finalize the underwriters of the first IPO of Shake Shack.

No spokesperson from any of the involved companies could be reached for a comment on the latest news.

Market analysts are of the view that Shake Shack’s IPO will be the most popular one among the recent offerings made by a number of dinning chains, including Zoe’s Kitchen (NYSE:ZOES), El Pollo Loco Holdings Inc. (NASDAQ:LOCO) and Papa Murphy’s Holdings Inc. (NASDAQ:FRSH).

As far as the operations of Shake Shack are concerned, the chain is located in a number of U.S. States including, New Jersey, New York, Pennsylvania, Connecticut, Massachusetts and Florida. Moreover, the chain is also present in international regions, such as Istanbul, Dubai, London and Moscow.

It is important to note here that Shake Shack does not have any franchises nor does it plan to open up any in the future. The chief executive officer of Shake Shack, Randy Garutti, who is a graduate of Cornell University, reiterated this point by saying that the company will not cater to any franchise demand, at least in the near future.

Coming to the stocks of JPMorgan Chase & Co. (NYSE:JPM), the company, on the last trading day, started its stocks at a price of $57.66 and closed at a price of $58.50, after hitting the highest figures of $58.77. The company has a market capitalization of $216.8 billion with a price to earnings ratio of 15.1 and a dividend yield of 2.74 percent.

Coming to the stocks of Morgan Stanley (NYSE:MS), the company, on August 21, started its stocks at a price of $32.66 and closed at a price of $33.03. The intra-day range for the company’s stocks was recorded to be from $32.50 to $33.05. The company has a total market capitalization of $63.89 billion, with a price to earnings ratio of 15.56 and a dividend yield of 1.21 percent.