Potbelly to open new Illinois locations under franchise agreement

CHICAGO - Potbelly (NASDAQ:PBPB) Corporation (NASDAQ: PBPB), a popular sandwich shop chain currently valued at $382 million, is set to expand its Illinois presence with the opening of three new franchise locations. The company, which has seen its stock surge over 61% in the past six months according to InvestingPro data, announced the new Shop Development Agreement (SDA) with franchisees Anand and Nimisha Patel, who plan to establish the new Potbelly shops in the Kane and Kendall markets.

The Patels, experienced in the food and beverage industry with ownership of brands such as Dunkin’ Donuts and Baskin Robbins, have committed to contributing to Potbelly’s strategic growth. This move is part of Potbelly’s broader plan to increase its footprint through franchising in key areas nationwide, particularly in Illinois and neighboring states. With a healthy gross profit margin of 35.5% and positive analyst sentiment, the company appears well-positioned for expansion. InvestingPro data shows analysts have set price targets ranging from $14 to $16, suggesting potential upside from current levels.

This expansion is expected to generate local economic development by creating job opportunities in the targeted areas. Potbelly, known for its toasted sandwiches, hand-dipped shakes, and community-focused atmosphere, continues to seek partnerships with multi-unit operators who are dedicated to maintaining quality and engaging with the communities they serve.

While the specific locations of the new shops and details about their grand openings have yet to be disclosed, the announcement indicates Potbelly’s ongoing efforts to enhance its market reach through franchising opportunities. The new franchises in Illinois underscore the company’s commitment to growth and its strategy to partner with established operators.

This news is based on a press release statement, and further information regarding the franchise opportunities with Potbelly Sandwich Works can be sought directly from the company.

In other recent news, Potbelly Corporation has reported preliminary results for its fourth fiscal quarter, highlighting a slight increase in same-store sales growth and a strong adjusted EBITDA. The company’s estimates indicate a growth of 0.2% to 0.3% in same-store sales, exceeding their initial guidance of a potential decrease. Additionally, Potbelly successfully opened eight new shops during the quarter and secured commitments for 30 new franchise locations, bringing the total number of open and committed shops to 727. Looking ahead, the company has 38 new shop sites in development for 2025, signaling continued expansion.

In a significant move, Potbelly has signed a Shop Development Agreement to open four new locations in Jackson, Mississippi, as part of its strategy to expand through franchising. This agreement, in partnership with franchisee Michael Wimberly, marks a key step in Potbelly’s growth efforts. Furthermore, Potbelly has appointed KPMG LLP as its new independent registered public accounting firm for the fiscal year ending December 27, 2025, following a competitive selection process. The transition to KPMG will occur after the completion of the audit report for the fiscal year ended December 29, 2024, by the outgoing auditor, Deloitte & Touche LLP.

Potbelly confirmed there were no disagreements with Deloitte during their engagement, and Deloitte’s previous reports did not contain any adverse opinions or qualifications. These developments reflect Potbelly’s ongoing efforts to enhance its financial oversight and expand its presence in key markets.

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