According to a company statement this week, sandwich chain Jersey Mike’s has filed confidentially for an initial public offering. On its face, this seems like an offering that should go well.
Jersey Mike’s already is the second-largest sandwich chain in the U.S., trailing only Subway. It’s continuing to add locations, with restaurant count up nearly 900 since the start of 2023, surpassing 3,200. Franchise disclosure documents show solid performance in 2025, with revenue up more than 10%. Net profit did decline year-over-year, but it’s not clear whether one-time factors or non-cash expenses played a role.
Jersey Mike’s earnings have grown nicely across this decade.
This seems like a high-quality franchisor with plenty of room for growth. In January, the sandwich chain announced plans to build out over 400 locations in the United Kingdom and Ireland. Founder Peter Cancro, who incredibly had full ownership of the company until just last year, stepped down last year and was replaced by Charlie Morrison.
Morrison did an outstanding job in a decade running Wingstop, and investors no doubt will see his stewardship as a positive.
In that context, reports that private equity firm Blackstone, the current majority owner, is looking for a valuation over $12 billion seem potentially reasonable. That’s all the more true given that Jersey Mike’s, according to Bloomberg, issued $760 million in debt in January (so-called “whole business bonds”, which are collateralized by the company’s revenue) and saw that offering price well.
Can Jersey Mike’s Justify a $12 Billion IPO?
There no doubt will be some skeptics regarding a Jersey Mike’s IPO, particularly at the $12 billion-plus figure. Blackstone only acquired its stake (reported to be 90%) last year at a valuation widely cited as being around $8 billion. Expecting 50%-plus returns in eighteen months (assuming the IPO goes off later this year) could be potentially aggressive.
That’s particularly true because the expected valuation would be in the range of 70 times 2025 net earnings. Even assuming the adjusted profit might be higher, high-quality franchisors like McDonald’s and Domino’s are trading in 20x-25x range on the same basis.
There are sector concerns, as well. Jersey Mike’s is launching its IPO at a time when the fast-casual space as a whole looks wobbly. The likes of Chipotle, Shake Shack, and Sweetgreen all have pulled back sharply from their highs.
Backers of Jersey Mike’s might point to the rebound (and the valuation) of Cava, which has rallied back near past highs and trades at a premium to where the Jersey Mike’s IPO is likely to land.
But it’s far from guaranteed that investor appetite (pardon the pun) for fast casual will be intact by the time the IPO rolls around.
Sandwich Sector’s History Signals Caution
Looking closer at the space, sandwich chains haven’t always been solid long-term investments.
Subway did get a buyout at nearly $10 billion in 2024, but that deal came twelve years after its sales peaked. Jimmy John’s, according to its founder, came close to its own IPO in 2015, reversed course, and sold to Roark Capital’s Inspire Brands in 2019 for a reported $3.1 billion. It seems likely, at least from a distance, that the chain’s valuation is no longer at the mark. (Investors will get a better sense later this year; Inspire, too, is planning to go public.)
On the whole, Jersey Mike’s looks like it should be a fascinating deal to watch.
The history of the business and its growth from a single shop to billions in annual system-wide sales suggests Jersey Mike’s is a company worth owning. In contrast, the history of the space, and the pressures on the consumer, suggest some caution. The core question might well come down to price, and if Blackstone truly got a bargain in 2024 – or is simply expecting too much from the market in 2026.
Vince Martin is an analyst and author whose work has appeared on multiple financial industry websites for more than a decade; he’s currently the lead writer for Wall Street & Main. As of this writing, he has no positions in any companies mentioned.
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