Benzinga | Aug 20, 2020 03:33PM EDT

Josh Brown Weighs In On Wedbush's Call On Shake Shack

Josh Brown spoke on CNBC's "Fast Money Halftime Report" about Shake Shack Inc (NYSE:SHAK), which was upgraded by Wedbush to Outperform. The analyst has also increased his price target for the stock to $77.

Brown said Shake Shack is undoubtedly one of the big losers in its category from the pandemic. The reason is the model of how it opened its stores. The management picked high foot traffic places in tourist locations and none of that is happening right now, explained Brown.

The stock is still trading at a high price-to-earnings multiple so it's not cheap. Tech and app spending, the company had to do in the long term, has been accelerated because all the best companies in the sector have already done that.

If you want to be in something that is working now, you should be in Chipotle Mexican Grill, Inc. (NYSE:CMG) instead of Shake Shack because Chipotle has already done all the things Shake Shack needs to do, thinks Brown. He has a long position in Shake Shack, but he is not expecting the stock to move to $77 in the next 12 months.