The Popular Sub Shop Jersey Mike's Is Planning an IPO. Is This the Next Big Fast Casual Food Stock?

Jersey Mike's, the second-largest hoagie chain in the U.S., has confidentially filed for an initial public offering, the company said in a press release issued earlier today.

The company has over 3,200 locations.

Image source: Getty Images.

In November 2024, the large private equity firm Blackstone acquired Jersey Mike's in a deal that reportedly valued the company at $8 billion in enterprise value, which includes debt. Bloomberg recently reported that the Jersey Mike's IPO could look to raise $1 billion at a $12 billion valuation.

At the time of the Blackstone deal, Reuters reported the deal included an earn-out provision under which the full acquisition price would be paid after Jersey Mike's opens its 4,000th location.

Other fast-casual stocks, such as Chipotle and Cava, have delivered strong returns for shareholders. Is Jersey Mike's the next big fast-casual food stock?

Fast-casual companies can be solid stocks

The fast-casual space can be interesting. These kinds of stocks, especially industry leaders, can grow much faster and achieve much better margins than food and beverage stocks in consumer staples and defensive categories.

They can also leverage artificial intelligence to improve their operations, such as making and delivering food faster to serve more customers. But they can also be cyclical, facing pressure if consumer spending slows and higher costs in a higher-inflation environment marked by labor shortages and wage pressures.

According to CNBC, Jersey Mike's reported nearly $310 billion in revenue in 2025, a 10.6% increase from the prior year. However, net income fell from nearly $239 million in 2024 to nearly $184 million in 2025.

Jersey Mike's also reportedly raised $760 million of debt by selling bonds earlier this year. The debt includes a provision that allows the sandwich shop to repay about half of the debt early with proceeds from the IPO.

The company grew locations by 8% in 2025, according to The Wall Street Journal, citing research from the market research firm Technomic Research. A story from Entrepreneur quotes CEO Charlie Morrison, who took the helm of Jersey Mike's last year, as saying he thinks the brand could eventually double its U.S. locations and has a big expansion opportunity abroad as well.

Ultimately, competitors in the quick-service and fast-casual spaces can trade in a wide range of valuations.

QSR PE Ratio data by YCharts

The good news for prospective Jersey Mike's investors is that the company is growing sales and locations nicely, and appears to have a strong growth opportunity ahead. However, investors will likely want to ensure the debt is manageable and that the 2025 profit decline was due to non-recurring pressures.

The stock could certainly have promise, but investors ultimately need more financial details before deciding whether buying it in the IPO or later is worth it.

Bram Berkowitz has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Blackstone, Cava Group, Chipotle Mexican Grill, and MTY Food Group. The Motley Fool recommends Restaurant Brands International and Wingstop and recommends the following options: short June 2026 $36 calls on Chipotle Mexican Grill. The Motley Fool has a disclosure policy.