Jamba Juice: Finally a Break-Out

True Blood - Spine Ripout

Shares of Jamba Juice (JMBA) are up 30% in the last 30 days. Will it get its spine ripped out like that guy from True Blood?

 

Mastery has been following Jamba since back in the day.

Just a year ago, we talked up a $3 price target for shares of the Juice-Maker.

Now we provide a fresh analysis on whether or not the stock will rise to all-time highs or bleed back down to 2011 levels.

Fundamentals:

While JMBA hasn't posted a profit since September of 2011, it is expected to post EPS of .07 a share in their upcoming Q2 earnings release, scheduled for August 15th.

Jamba has $19.26M cash on hand and no debt. But they need to do something about their negative margins, and fast. Which brings us to:

Growth Prospects:

The company has begun a franchise model, and franchisees tend to be much better at operations than the food company itself - just ask Subway, Domino's, and Dunkin' Donuts.

In addition, JMBA has signed agreements to grow their international presence in places like the Philippines, South Korea, and the great white north - Canada.

But the real dough could start rolling in thanks to their licensing agreements to produce and sell consumer products such as smoothie kits,frozen yogurt, energy drinks, coconut water and energy bars. It's on like Donkey Kong.

Mastery Bottom Line:

Health Food Stocks like WFM, TFM, GNC, BNNY, and Jamba (JMBA) have all been in a bull market in 2012. It may be an investing fad, but Jamba really could be the next Starbucks - on every street corner, mall, and all the grocery stores.

Chart:

A look at the Chart shows a parabolic move from $2 to $2.60 since the beginning of July. A little pullback is to be expected (and should provide time for us to get in on the bull flag). Look for a pullback to $2.45 but place a tight stop in case the overall market decides to crap out, in which case the "True Blood ripping-out-of-the-spine scenario" takes place, if that happens shares could retrace back to $2.