EUROPEAN WAX CENTER INC-A (EWCZ)
US29882P1066 - Common Stock
We assign a fundamental rating of 5 out of 10 to EWCZ. EWCZ was compared to 65 industry peers in the Diversified Consumer Services industry. EWCZ has an average financial health and profitability rating. EWCZ has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
In the past year EWCZ was profitable.
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.
1.2 Ratios
EWCZ has a Return On Assets (1.72%) which is comparable to the rest of the industry.
The Return On Equity of EWCZ (14.80%) is better than 76.56% of its industry peers.
The Return On Invested Capital of EWCZ (4.83%) is better than 68.75% of its industry peers.
EWCZ had an Average Return On Invested Capital over the past 3 years of 3.67%. This is significantly below the industry average of 11.90%.
The last Return On Invested Capital (4.83%) for EWCZ is above the 3 year average (3.67%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.72% | ||
| ROE | 14.8% | ||
| ROIC | 4.83% |
ROA(3y)0.56%
ROA(5y)-1.22%
ROE(3y)6.02%
ROE(5y)0.71%
ROIC(3y)3.67%
ROIC(5y)N/A
1.3 Margins
The Profit Margin of EWCZ (5.61%) is better than 65.63% of its industry peers.
The Operating Margin of EWCZ (22.71%) is better than 90.63% of its industry peers.
The Gross Margin of EWCZ (72.82%) is better than 79.69% of its industry peers.
In the last couple of years the Gross Margin of EWCZ has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 22.71% | ||
| PM (TTM) | 5.61% | ||
| GM | 72.82% |
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y2.95%
GM growth 5YN/A
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), EWCZ is destroying value.
Compared to 1 year ago, EWCZ has less shares outstanding
Compared to 1 year ago, EWCZ has an improved debt to assets ratio.
2.2 Solvency
EWCZ has an Altman-Z score of 0.87. This is a bad value and indicates that EWCZ is not financially healthy and even has some risk of bankruptcy.
EWCZ has a Altman-Z score (0.87) which is in line with its industry peers.
The Debt to FCF ratio of EWCZ is 6.37, which is on the high side as it means it would take EWCZ, 6.37 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of EWCZ (6.37) is better than 62.50% of its industry peers.
EWCZ has a Debt/Equity ratio of 4.39. This is a high value indicating a heavy dependency on external financing.
EWCZ has a Debt to Equity ratio of 4.39. This is amonst the worse of the industry: EWCZ underperforms 84.38% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 4.39 | ||
| Debt/FCF | 6.37 | ||
| Altman-Z | 0.87 |
ROIC/WACC0.74
WACC6.5%
2.3 Liquidity
EWCZ has a Current Ratio of 3.49. This indicates that EWCZ is financially healthy and has no problem in meeting its short term obligations.
EWCZ has a better Current ratio (3.49) than 82.81% of its industry peers.
EWCZ has a Quick Ratio of 2.72. This indicates that EWCZ is financially healthy and has no problem in meeting its short term obligations.
EWCZ has a Quick ratio of 2.72. This is in the better half of the industry: EWCZ outperforms 75.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 3.49 | ||
| Quick Ratio | 2.72 |
3. Growth
3.1 Past
EWCZ shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -64.44%.
Looking at the last year, EWCZ shows a small growth in Revenue. The Revenue has grown by 2.87% in the last year.
Measured over the past years, EWCZ shows a very strong growth in Revenue. The Revenue has been growing by 28.82% on average per year.
EPS 1Y (TTM)-64.44%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%36.36%
Revenue 1Y (TTM)2.87%
Revenue growth 3Y28.82%
Revenue growth 5YN/A
Sales Q2Q%1.32%
3.2 Future
The Earnings Per Share is expected to grow by 25.08% on average over the next years. This is a very strong growth
Based on estimates for the next years, EWCZ will show a quite strong growth in Revenue. The Revenue will grow by 8.80% on average per year.
EPS Next Y-15.12%
EPS Next 2Y1.54%
EPS Next 3Y6.22%
EPS Next 5Y25.08%
Revenue Next Year-0.13%
Revenue Next 2Y1.93%
Revenue Next 3Y3.56%
Revenue Next 5Y8.8%
3.3 Evolution
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 15.35, EWCZ is valued correctly.
Based on the Price/Earnings ratio, EWCZ is valued a bit cheaper than 79.69% of the companies in the same industry.
EWCZ's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 30.45.
The Price/Forward Earnings ratio is 17.87, which indicates a rather expensive current valuation of EWCZ.
EWCZ's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. EWCZ is cheaper than 64.06% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 21.99, EWCZ is valued at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.35 | ||
| Fwd PE | 17.87 |
4.2 Price Multiples
70.31% of the companies in the same industry are more expensive than EWCZ, based on the Enterprise Value to EBITDA ratio.
EWCZ's Price/Free Cash Flow ratio is rather cheap when compared to the industry. EWCZ is cheaper than 95.31% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 7.47 | ||
| EV/EBITDA | 10.73 |
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 2Y1.54%
EPS Next 3Y6.22%
5. Dividend
5.1 Amount
EWCZ does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
EUROPEAN WAX CENTER INC-A
NASDAQ:EWCZ (9/18/2024, 8:00:03 PM)
After market: 7.37 0 (0%)7.37
+0.04 (+0.55%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryDiversified Consumer Services
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap441.68M
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
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Surprises & Revisions
EPS beat(2)
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PT rev (1m)
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Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.35 | ||
| Fwd PE | 17.87 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.72% | ||
| ROE | 14.8% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 22.71% | ||
| PM (TTM) | 5.61% | ||
| GM | 72.82% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.31
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 4.39 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 3.49 | ||
| Quick Ratio | 2.72 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
High Growth Momentum
Growth
EPS 1Y (TTM)-64.44%
EPS 3YN/A
EPS 5Y
EPS Q2Q%
EPS Next Y-15.12%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)2.87%
Revenue growth 3Y28.82%
Revenue growth 5Y
Sales Q2Q%
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y