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DRIVEN BRANDS HOLDINGS INC (DRVN) Stock Fundamental Analysis

NASDAQ:DRVN - Nasdaq - US26210V1026 - Common Stock

16.09  +0.19 (+1.19%)

After market: 16.09 0 (0%)

Fundamental Rating

4

Overall DRVN gets a fundamental rating of 4 out of 10. We evaluated DRVN against 83 industry peers in the Commercial Services & Supplies industry. There are concerns on the financial health of DRVN while its profitability can be described as average. DRVN has a decent growth rate and is not valued too expensively.


Dividend Valuation Growth Profitability Health

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5

1. Profitability

1.1 Basic Checks

DRVN had positive earnings in the past year.
DRVN had a positive operating cash flow in the past year.
In multiple years DRVN reported negative net income over the last 5 years.
Each year in the past 5 years DRVN had a positive operating cash flow.
DRVN Yearly Net Income VS EBIT VS OCF VS FCFDRVN Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2018 2019 2020 2021 2022 2023 0 200M -200M -400M -600M

1.2 Ratios

DRVN has a worse Return On Assets (0.11%) than 60.98% of its industry peers.
The Return On Equity of DRVN (0.66%) is comparable to the rest of the industry.
The Return On Invested Capital of DRVN (3.56%) is comparable to the rest of the industry.
DRVN had an Average Return On Invested Capital over the past 3 years of 3.35%. This is significantly below the industry average of 10.08%.
The 3 year average ROIC (3.35%) for DRVN is below the current ROIC(3.56%), indicating increased profibility in the last year.
Industry RankSector Rank
ROA 0.11%
ROE 0.66%
ROIC 3.56%
ROA(3y)-3.92%
ROA(5y)-2.29%
ROE(3y)-26.34%
ROE(5y)-15.35%
ROIC(3y)3.35%
ROIC(5y)2.96%
DRVN Yearly ROA, ROE, ROICDRVN Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2018 2019 2020 2021 2022 2023 0 -20 -40 -60 -80

1.3 Margins

DRVN has a Profit Margin (0.27%) which is in line with its industry peers.
The Operating Margin of DRVN (13.00%) is better than 78.05% of its industry peers.
In the last couple of years the Operating Margin of DRVN has grown nicely.
Looking at the Gross Margin, with a value of 46.52%, DRVN belongs to the top of the industry, outperforming 81.71% of the companies in the same industry.
DRVN's Gross Margin has declined in the last couple of years.
Industry RankSector Rank
OM 13%
PM (TTM) 0.27%
GM 46.52%
OM growth 3Y0.94%
OM growth 5Y2.71%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-4.42%
GM growth 5Y-5.94%
DRVN Yearly Profit, Operating, Gross MarginsDRVN Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2018 2019 2020 2021 2022 2023 0 20 -20 40 60

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3

2. Health

2.1 Basic Checks

The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so DRVN is destroying value.
The number of shares outstanding for DRVN has been reduced compared to 1 year ago.
The number of shares outstanding for DRVN has been reduced compared to 5 years ago.
DRVN has a worse debt/assets ratio than last year.
DRVN Yearly Shares OutstandingDRVN Yearly Shares OutstandingYearly Shares Outstanding 2018 2019 2020 2021 2022 2023 50M 100M 150M
DRVN Yearly Total Debt VS Total AssetsDRVN Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2018 2019 2020 2021 2022 2023 2B 4B 6B

2.2 Solvency

DRVN has an Altman-Z score of 0.81. This is a bad value and indicates that DRVN is not financially healthy and even has some risk of bankruptcy.
With a Altman-Z score value of 0.81, DRVN is not doing good in the industry: 78.05% of the companies in the same industry are doing better.
A Debt/Equity ratio of 2.84 is on the high side and indicates that DRVN has dependencies on debt financing.
With a Debt to Equity ratio value of 2.84, DRVN is not doing good in the industry: 86.59% of the companies in the same industry are doing better.
Industry RankSector Rank
Debt/Equity 2.84
Debt/FCF N/A
Altman-Z 0.81
ROIC/WACC0.47
WACC7.56%
DRVN Yearly LT Debt VS Equity VS FCFDRVN Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2018 2019 2020 2021 2022 2023 0 1B 2B

2.3 Liquidity

A Current Ratio of 1.90 indicates that DRVN should not have too much problems paying its short term obligations.
Looking at the Current ratio, with a value of 1.90, DRVN is in the better half of the industry, outperforming 70.73% of the companies in the same industry.
DRVN has a Quick Ratio of 1.72. This is a normal value and indicates that DRVN is financially healthy and should not expect problems in meeting its short term obligations.
DRVN's Quick ratio of 1.72 is fine compared to the rest of the industry. DRVN outperforms 75.61% of its industry peers.
Industry RankSector Rank
Current Ratio 1.9
Quick Ratio 1.72
DRVN Yearly Current Assets VS Current LiabilitesDRVN Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2018 2019 2020 2021 2022 2023 200M 400M 600M 800M

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5

3. Growth

3.1 Past

DRVN shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 4.04%.
The Revenue has been growing slightly by 1.71% in the past year.
Measured over the past years, DRVN shows a very strong growth in Revenue. The Revenue has been growing by 36.14% on average per year.
EPS 1Y (TTM)4.04%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%30%
Revenue 1Y (TTM)1.71%
Revenue growth 3Y36.59%
Revenue growth 5Y36.14%
Sales Q2Q%1.83%

3.2 Future

Based on estimates for the next years, DRVN will show a very strong growth in Earnings Per Share. The EPS will grow by 22.90% on average per year.
Based on estimates for the next years, DRVN will show a small growth in Revenue. The Revenue will grow by 7.99% on average per year.
EPS Next Y12.94%
EPS Next 2Y16.91%
EPS Next 3Y20.77%
EPS Next 5Y22.9%
Revenue Next Year1.4%
Revenue Next 2Y4.61%
Revenue Next 3Y7.02%
Revenue Next 5Y7.99%

3.3 Evolution

The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
DRVN Yearly Revenue VS EstimatesDRVN Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 1B 2B 3B
DRVN Yearly EPS VS EstimatesDRVN Yearly EPS VS EstimatesYearly EPS VS Estimates 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 0.5 1 1.5 2

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5

4. Valuation

4.1 Price/Earnings Ratio

The Price/Earnings ratio is 15.62, which indicates a correct valuation of DRVN.
Based on the Price/Earnings ratio, DRVN is valued a bit cheaper than the industry average as 78.05% of the companies are valued more expensively.
DRVN's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 28.29.
DRVN is valuated correctly with a Price/Forward Earnings ratio of 12.66.
DRVN's Price/Forward Earnings ratio is rather cheap when compared to the industry. DRVN is cheaper than 87.80% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 24.44. DRVN is valued slightly cheaper when compared to this.
Industry RankSector Rank
PE 15.62
Fwd PE 12.66
DRVN Price Earnings VS Forward Price EarningsDRVN Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 20 40 60

4.2 Price Multiples

65.85% of the companies in the same industry are more expensive than DRVN, based on the Enterprise Value to EBITDA ratio.
Industry RankSector Rank
P/FCF N/A
EV/EBITDA 10.69
DRVN Per share dataDRVN EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 0 5 -5 10

4.3 Compensation for Growth

The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
DRVN's earnings are expected to grow with 20.77% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.21
PEG (5Y)N/A
EPS Next 2Y16.91%
EPS Next 3Y20.77%

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0

5. Dividend

5.1 Amount

DRVN does not give a dividend.
Industry RankSector Rank
Dividend Yield N/A

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DRIVEN BRANDS HOLDINGS INC

NASDAQ:DRVN (1/21/2025, 5:24:35 PM)

After market: 16.09 0 (0%)

16.09

+0.19 (+1.19%)

Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCommercial & Professional Services
GICS IndustryCommercial Services & Supplies
Earnings (Last)10-31 2024-10-31/bmo
Earnings (Next)02-20 2025-02-20/amc
Inst Owners38.33%
Inst Owner Change0.01%
Ins Owners2.38%
Ins Owner Change0.18%
Market Cap2.64B
Analysts78.95
Price Target19.38 (20.45%)
Short Float %8.61%
Short Ratio12.89
Dividend
Industry RankSector Rank
Dividend Yield N/A
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)19.47%
Min EPS beat(2)17.26%
Max EPS beat(2)21.68%
EPS beat(4)3
Avg EPS beat(4)14.5%
Min EPS beat(4)-0.65%
Max EPS beat(4)21.68%
EPS beat(8)6
Avg EPS beat(8)8.39%
EPS beat(12)10
Avg EPS beat(12)11.7%
EPS beat(16)13
Avg EPS beat(16)20.83%
Revenue beat(2)0
Avg Revenue beat(2)-3.87%
Min Revenue beat(2)-4.68%
Max Revenue beat(2)-3.07%
Revenue beat(4)0
Avg Revenue beat(4)-4.17%
Min Revenue beat(4)-4.94%
Max Revenue beat(4)-3.07%
Revenue beat(8)1
Avg Revenue beat(8)-2.48%
Revenue beat(12)5
Avg Revenue beat(12)-0.07%
Revenue beat(16)9
Avg Revenue beat(16)1.62%
PT rev (1m)0.97%
PT rev (3m)7.73%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-21.27%
EPS NY rev (1m)0%
EPS NY rev (3m)0.7%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-2.49%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-0.5%
Valuation
Industry RankSector Rank
PE 15.62
Fwd PE 12.66
P/S 1.13
P/FCF N/A
P/OCF 11.4
P/B 2.74
P/tB N/A
EV/EBITDA 10.69
EPS(TTM)1.03
EY6.4%
EPS(NY)1.27
Fwd EY7.9%
FCF(TTM)-0.62
FCFYN/A
OCF(TTM)1.41
OCFY8.77%
SpS14.19
BVpS5.87
TBVpS-6.96
PEG (NY)1.21
PEG (5Y)N/A
Profitability
Industry RankSector Rank
ROA 0.11%
ROE 0.66%
ROCE 5.64%
ROIC 3.56%
ROICexc 3.7%
ROICexgc 6.25%
OM 13%
PM (TTM) 0.27%
GM 46.52%
FCFM N/A
ROA(3y)-3.92%
ROA(5y)-2.29%
ROE(3y)-26.34%
ROE(5y)-15.35%
ROIC(3y)3.35%
ROIC(5y)2.96%
ROICexc(3y)3.54%
ROICexc(5y)3.1%
ROICexgc(3y)7.16%
ROICexgc(5y)12.58%
ROCE(3y)5.31%
ROCE(5y)4.68%
ROICexcg growth 3Y10.92%
ROICexcg growth 5Y-31.07%
ROICexc growth 3Y27.29%
ROICexc growth 5Y3.49%
OM growth 3Y0.94%
OM growth 5Y2.71%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-4.42%
GM growth 5Y-5.94%
F-Score9
Asset Turnover0.4
Health
Industry RankSector Rank
Debt/Equity 2.84
Debt/FCF N/A
Debt/EBITDA 5.65
Cap/Depr 184.44%
Cap/Sales 14.31%
Interest Coverage 2.06
Cash Conversion 47.92%
Profit Quality N/A
Current Ratio 1.9
Quick Ratio 1.72
Altman-Z 0.81
F-Score9
WACC7.56%
ROIC/WACC0.47
Cap/Depr(3y)259.72%
Cap/Depr(5y)196.05%
Cap/Sales(3y)19.43%
Cap/Sales(5y)13.76%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)4.04%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%30%
EPS Next Y12.94%
EPS Next 2Y16.91%
EPS Next 3Y20.77%
EPS Next 5Y22.9%
Revenue 1Y (TTM)1.71%
Revenue growth 3Y36.59%
Revenue growth 5Y36.14%
Sales Q2Q%1.83%
Revenue Next Year1.4%
Revenue Next 2Y4.61%
Revenue Next 3Y7.02%
Revenue Next 5Y7.99%
EBIT growth 1Y-4.62%
EBIT growth 3Y37.87%
EBIT growth 5Y39.82%
EBIT Next Year47.49%
EBIT Next 3Y24.7%
EBIT Next 5Y21.48%
FCF growth 1Y-12.66%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y-8.54%
OCF growth 3Y40.94%
OCF growth 5Y43.39%