We don’t believe Jersey Mike’s has amassed a competitive edge, which we see as critical to endure in the hotly contested restaurant landscape. The chain’s scale still pales when pinned against chained operators competing for lunch traffic, and we question how much of its system sales growth over the past seven years (up nearly 4 times) reflects true brand prowess as opposed to capitalizing on missteps (overexpansion and lackluster store-level cash flows) by fast-food sandwich rivals like Subway. From where we sit, the sub category’s relatively low buildout costs leave the door open to well-capitalized entrants, while rapidly expanding peers and larger limited-service foes are unlikely to let up on strengthening their value propositions.