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Price Forecast:

Bullish Case: FAT Brands could benefit from ongoing market expansion and recovery from operational challenges. Strong brand portfolio and potential new acquisitions can drive significant revenue growth, supported by positive sentiment around plant-based dining trends.

Bearish Case: Continued legal issues, especially surrounding former management, pose significant risks to FAT Brands' reputation and financial stability. Ongoing operational losses and economic headwinds could lead to substantial stock price declines.

Potential Outcomes:

1. Continued expansion success (30%);

2. Dividend increase (20%);

3. Operational losses persist (25%);

4. Strategic acquisition failure (15%);

5. Market correction impacts (10%).

Trading Oracle: Consider initiating credit spreads (short volatility) given bearish tendencies in the near term. Target a $4.50 to $5.00 range with a focus on a 3-6 month outlook, leveraging high reward-to-risk potential amidst current uncertainties.

August 24, 2024