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EUROPEAN WAX CENTER INC-A (EWCZ) Stock Fundamental Analysis

NASDAQ:EWCZ - Nasdaq - US29882P1066 - Common Stock - Currency: USD

6.57  -0.25 (-3.67%)

After market: 6.57 0 (0%)

Fundamental Rating

5

Overall EWCZ gets a fundamental rating of 5 out of 10. We evaluated EWCZ against 71 industry peers in the Diversified Consumer Services industry. Both the profitability and the financial health of EWCZ get a neutral evaluation. Nothing too spectacular is happening here. EWCZ has a decent growth rate and is not valued too expensively.


Dividend Valuation Growth Profitability Health

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6

1. Profitability

1.1 Basic Checks

EWCZ had positive earnings in the past year.
EWCZ had a positive operating cash flow in the past year.
The reported net income has been mixed in the past 5 years: EWCZ reported negative net income in multiple years.
EWCZ had a positive operating cash flow in each of the past 5 years.
EWCZ Yearly Net Income VS EBIT VS OCF VS FCFEWCZ Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2019 2020 2021 2022 2023 0 20M -20M 40M

1.2 Ratios

The Return On Assets of EWCZ (1.95%) is comparable to the rest of the industry.
EWCZ's Return On Equity of 19.98% is amongst the best of the industry. EWCZ outperforms 81.25% of its industry peers.
The Return On Invested Capital of EWCZ (5.74%) is better than 70.31% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for EWCZ is significantly below the industry average of 12.02%.
The 3 year average ROIC (3.67%) for EWCZ is below the current ROIC(5.74%), indicating increased profibility in the last year.
Industry RankSector Rank
ROA 1.95%
ROE 19.98%
ROIC 5.74%
ROA(3y)0.56%
ROA(5y)-1.22%
ROE(3y)6.02%
ROE(5y)0.71%
ROIC(3y)3.67%
ROIC(5y)N/A
EWCZ Yearly ROA, ROE, ROICEWCZ Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2019 2020 2021 2022 2023 0 5 -5 10

1.3 Margins

EWCZ has a Profit Margin of 5.01%. This is in the better half of the industry: EWCZ outperforms 60.94% of its industry peers.
With an excellent Operating Margin value of 21.35%, EWCZ belongs to the best of the industry, outperforming 89.06% of the companies in the same industry.
EWCZ's Gross Margin of 73.26% is amongst the best of the industry. EWCZ outperforms 87.50% of its industry peers.
EWCZ's Gross Margin has improved in the last couple of years.
Industry RankSector Rank
OM 21.35%
PM (TTM) 5.01%
GM 73.26%
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y2.95%
GM growth 5YN/A
EWCZ Yearly Profit, Operating, Gross MarginsEWCZ Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2019 2020 2021 2022 2023 0 20 -20 40 60

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5

2. Health

2.1 Basic Checks

The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so EWCZ is destroying value.
The number of shares outstanding for EWCZ has been reduced compared to 1 year ago.
Compared to 1 year ago, EWCZ has an improved debt to assets ratio.
EWCZ Yearly Shares OutstandingEWCZ Yearly Shares OutstandingYearly Shares Outstanding 2019 2020 2021 2022 2023 20M 40M 60M
EWCZ Yearly Total Debt VS Total AssetsEWCZ Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2019 2020 2021 2022 2023 200M 400M 600M

2.2 Solvency

Based on the Altman-Z score of 0.93, we must say that EWCZ is in the distress zone and has some risk of bankruptcy.
EWCZ has a Altman-Z score (0.93) which is comparable to the rest of the industry.
EWCZ has a debt to FCF ratio of 6.68. This is a slightly negative value and a sign of low solvency as EWCZ would need 6.68 years to pay back of all of its debts.
EWCZ's Debt to FCF ratio of 6.68 is fine compared to the rest of the industry. EWCZ outperforms 62.50% of its industry peers.
EWCZ has a Debt/Equity ratio of 5.40. This is a high value indicating a heavy dependency on external financing.
Looking at the Debt to Equity ratio, with a value of 5.40, EWCZ is doing worse than 82.81% of the companies in the same industry.
Industry RankSector Rank
Debt/Equity 5.4
Debt/FCF 6.68
Altman-Z 0.93
ROIC/WACC0.62
WACC9.31%
EWCZ Yearly LT Debt VS Equity VS FCFEWCZ Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2019 2020 2021 2022 2023 0 100M 200M 300M

2.3 Liquidity

A Current Ratio of 3.17 indicates that EWCZ has no problem at all paying its short term obligations.
The Current ratio of EWCZ (3.17) is better than 82.81% of its industry peers.
EWCZ has a Quick Ratio of 2.42. This indicates that EWCZ is financially healthy and has no problem in meeting its short term obligations.
EWCZ's Quick ratio of 2.42 is fine compared to the rest of the industry. EWCZ outperforms 75.00% of its industry peers.
Industry RankSector Rank
Current Ratio 3.17
Quick Ratio 2.42
EWCZ Yearly Current Assets VS Current LiabilitesEWCZ Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2019 2020 2021 2022 2023 20M 40M 60M 80M

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5

3. Growth

3.1 Past

The earnings per share for EWCZ have decreased strongly by -64.71% in the last year.
EWCZ shows a strong growth in Revenue. In the last year, the Revenue has grown by 26.19%.
EWCZ shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 28.82% yearly.
EPS 1Y (TTM)-64.71%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%0%
Revenue 1Y (TTM)26.19%
Revenue growth 3Y28.82%
Revenue growth 5YN/A
Sales Q2Q%-0.52%

3.2 Future

EWCZ is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 12.36% yearly.
EWCZ is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 3.78% yearly.
EPS Next Y-9.29%
EPS Next 2Y-0.83%
EPS Next 3Y3.28%
EPS Next 5Y12.36%
Revenue Next Year0.32%
Revenue Next 2Y1.36%
Revenue Next 3Y2.27%
Revenue Next 5Y3.78%

3.3 Evolution

When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
EWCZ Yearly Revenue VS EstimatesEWCZ Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2019 2020 2021 2022 2023 2024 2025 2026 2027 50M 100M 150M 200M 250M
EWCZ Yearly EPS VS EstimatesEWCZ Yearly EPS VS EstimatesYearly EPS VS Estimates 2019 2020 2021 2022 2023 2024 2025 2026 2027 0.5 1 1.5

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6

4. Valuation

4.1 Price/Earnings Ratio

With a Price/Earnings ratio of 13.69, EWCZ is valued correctly.
79.69% of the companies in the same industry are more expensive than EWCZ, based on the Price/Earnings ratio.
The average S&P500 Price/Earnings ratio is at 29.63. EWCZ is valued rather cheaply when compared to this.
With a Price/Forward Earnings ratio of 16.70, EWCZ is valued correctly.
EWCZ's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. EWCZ is cheaper than 78.13% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 22.68. EWCZ is valued slightly cheaper when compared to this.
Industry RankSector Rank
PE 13.69
Fwd PE 16.7
EWCZ Price Earnings VS Forward Price EarningsEWCZ Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 10 20 30

4.2 Price Multiples

76.56% of the companies in the same industry are more expensive than EWCZ, based on the Enterprise Value to EBITDA ratio.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of EWCZ indicates a rather cheap valuation: EWCZ is cheaper than 95.31% of the companies listed in the same industry.
Industry RankSector Rank
P/FCF 6.63
EV/EBITDA 9.07
EWCZ Per share dataEWCZ EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 0 2 -2 4 -4 -6

4.3 Compensation for Growth

The decent profitability rating of EWCZ may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y-0.83%
EPS Next 3Y3.28%

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0

5. Dividend

5.1 Amount

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

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EUROPEAN WAX CENTER INC-A

NASDAQ:EWCZ (2/21/2025, 8:16:25 PM)

After market: 6.57 0 (0%)

6.57

-0.25 (-3.67%)

Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryDiversified Consumer Services
Earnings (Last)11-14 2024-11-14/bmo
Earnings (Next)03-06 2025-03-06/amc
Inst Owners86.37%
Inst Owner Change-6.92%
Ins Owners0.77%
Ins Owner Change41.8%
Market Cap374.10M
Analysts74.67
Price Target8.22 (25.11%)
Short Float %6.28%
Short Ratio2.69
Dividend
Industry RankSector Rank
Dividend Yield N/A
Yearly Dividend3.25
Dividend Growth(5Y)N/A
DP5.91%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)87.17%
Min EPS beat(2)78.25%
Max EPS beat(2)96.08%
EPS beat(4)4
Avg EPS beat(4)73.84%
Min EPS beat(4)56.86%
Max EPS beat(4)96.08%
EPS beat(8)8
Avg EPS beat(8)188.05%
EPS beat(12)12
Avg EPS beat(12)185.71%
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)1
Avg Revenue beat(2)-1.99%
Min Revenue beat(2)-4.31%
Max Revenue beat(2)0.33%
Revenue beat(4)2
Avg Revenue beat(4)-0.97%
Min Revenue beat(4)-4.31%
Max Revenue beat(4)2.11%
Revenue beat(8)3
Avg Revenue beat(8)-1.59%
Revenue beat(12)5
Avg Revenue beat(12)-1.41%
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)-3.01%
PT rev (3m)-7.19%
EPS NQ rev (1m)2.22%
EPS NQ rev (3m)-46.51%
EPS NY rev (1m)0%
EPS NY rev (3m)6.86%
Revenue NQ rev (1m)0.72%
Revenue NQ rev (3m)-10.51%
Revenue NY rev (1m)0.23%
Revenue NY rev (3m)0.44%
Valuation
Industry RankSector Rank
PE 13.69
Fwd PE 16.7
P/S 1.36
P/FCF 6.63
P/OCF 6.6
P/B 5.42
P/tB N/A
EV/EBITDA 9.07
EPS(TTM)0.48
EY7.31%
EPS(NY)0.39
Fwd EY5.99%
FCF(TTM)0.99
FCFY15.08%
OCF(TTM)1
OCFY15.15%
SpS4.84
BVpS1.21
TBVpS-7.15
PEG (NY)N/A
PEG (5Y)N/A
Profitability
Industry RankSector Rank
ROA 1.95%
ROE 19.98%
ROCE 8.64%
ROIC 5.74%
ROICexc 6.18%
ROICexgc 25%
OM 21.35%
PM (TTM) 5.01%
GM 73.26%
FCFM 20.48%
ROA(3y)0.56%
ROA(5y)-1.22%
ROE(3y)6.02%
ROE(5y)0.71%
ROIC(3y)3.67%
ROIC(5y)N/A
ROICexc(3y)3.96%
ROICexc(5y)N/A
ROICexgc(3y)86.75%
ROICexgc(5y)N/A
ROCE(3y)5.53%
ROCE(5y)N/A
ROICexcg growth 3YN/A
ROICexcg growth 5YN/A
ROICexc growth 3YN/A
ROICexc growth 5YN/A
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y2.95%
GM growth 5YN/A
F-Score7
Asset Turnover0.39
Health
Industry RankSector Rank
Debt/Equity 5.4
Debt/FCF 6.68
Debt/EBITDA 4.72
Cap/Depr 1.44%
Cap/Sales 0.11%
Interest Coverage 2.66
Cash Conversion 71.7%
Profit Quality 408.67%
Current Ratio 3.17
Quick Ratio 2.42
Altman-Z 0.93
F-Score7
WACC9.31%
ROIC/WACC0.62
Cap/Depr(3y)15.15%
Cap/Depr(5y)101.49%
Cap/Sales(3y)1.69%
Cap/Sales(5y)13.65%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-64.71%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%0%
EPS Next Y-9.29%
EPS Next 2Y-0.83%
EPS Next 3Y3.28%
EPS Next 5Y12.36%
Revenue 1Y (TTM)26.19%
Revenue growth 3Y28.82%
Revenue growth 5YN/A
Sales Q2Q%-0.52%
Revenue Next Year0.32%
Revenue Next 2Y1.36%
Revenue Next 3Y2.27%
Revenue Next 5Y3.78%
EBIT growth 1Y32.76%
EBIT growth 3YN/A
EBIT growth 5YN/A
EBIT Next Year45.01%
EBIT Next 3Y16.51%
EBIT Next 5Y16.61%
FCF growth 1Y20.67%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y20.44%
OCF growth 3Y241.18%
OCF growth 5YN/A