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

NASDAQ:EWCZ - Nasdaq - US29882P1066 - Common Stock

6.36  +0.01 (+0.16%)

After market: 6.36 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. EWCZ has only an average score on both its financial health and profitability. EWCZ has a correct valuation and a medium growth rate.


Dividend Valuation Growth Profitability Health

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6

1. Profitability

1.1 Basic Checks

In the past year EWCZ was profitable.
In the past year EWCZ had a positive cash flow from operations.
In multiple years EWCZ reported negative net income over the last 5 years.
In the past 5 years EWCZ always reported a positive cash flow from operatings.
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

EWCZ has a Return On Assets of 1.95%. This is comparable to the rest of the industry: EWCZ outperforms 58.73% of its industry peers.
The Return On Equity of EWCZ (19.98%) is better than 82.54% of its industry peers.
Looking at the Return On Invested Capital, with a value of 5.74%, EWCZ is in the better half of the industry, outperforming 69.84% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for EWCZ is significantly below the industry average of 11.87%.
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

With a decent Profit Margin value of 5.01%, EWCZ is doing good in the industry, outperforming 61.90% of the companies in the same industry.
EWCZ has a better Operating Margin (21.35%) than 88.89% of its industry peers.
With an excellent Gross Margin value of 73.26%, EWCZ belongs to the best of the industry, outperforming 87.30% of the companies in the same industry.
In the last couple of years the Gross Margin of EWCZ has grown nicely.
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.
The debt/assets ratio for EWCZ has been reduced compared to a year ago.
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 0.90, we must say that EWCZ is in the distress zone and has some risk of bankruptcy.
EWCZ has a Altman-Z score of 0.90. This is comparable to the rest of the industry: EWCZ outperforms 50.79% of its industry peers.
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.
The Debt to FCF ratio of EWCZ (6.68) is better than 60.32% of its industry peers.
A Debt/Equity ratio of 5.40 is on the high side and indicates that EWCZ has dependencies on debt financing.
EWCZ's Debt to Equity ratio of 5.40 is on the low side compared to the rest of the industry. EWCZ is outperformed by 84.13% of its industry peers.
Industry RankSector Rank
Debt/Equity 5.4
Debt/FCF 6.68
Altman-Z 0.9
ROIC/WACC0.58
WACC9.96%
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.
With an excellent Current ratio value of 3.17, EWCZ belongs to the best of the industry, outperforming 84.13% of the companies in the same industry.
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 has a better Quick ratio (2.42) than 73.02% 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

Based on estimates for the next years, EWCZ will show a quite strong growth in Earnings Per Share. The EPS will grow by 12.36% on average per year.
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-1.93%
EPS Next 3Y3.01%
EPS Next 5Y12.36%
Revenue Next Year0.09%
Revenue Next 2Y1.21%
Revenue Next 3Y2.19%
Revenue Next 5Y3.78%

3.3 Evolution

The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
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

EWCZ is valuated correctly with a Price/Earnings ratio of 13.25.
EWCZ's Price/Earnings ratio is rather cheap when compared to the industry. EWCZ is cheaper than 85.71% of the companies in the same industry.
EWCZ is valuated cheaply when we compare the Price/Earnings ratio to 27.96, which is the current average of the S&P500 Index.
With a Price/Forward Earnings ratio of 16.53, EWCZ is valued correctly.
Based on the Price/Forward Earnings ratio, EWCZ is valued a bit cheaper than the industry average as 77.78% of the companies are valued more expensively.
EWCZ's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 24.11.
Industry RankSector Rank
PE 13.25
Fwd PE 16.53
EWCZ Price Earnings VS Forward Price EarningsEWCZ Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 5 10 15 20 25

4.2 Price Multiples

Based on the Enterprise Value to EBITDA ratio, EWCZ is valued a bit cheaper than 79.37% of the companies in the same industry.
95.24% of the companies in the same industry are more expensive than EWCZ, based on the Price/Free Cash Flow ratio.
Industry RankSector Rank
P/FCF 6.42
EV/EBITDA 8.73
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-1.93%
EPS Next 3Y3.01%

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0

5. Dividend

5.1 Amount

No dividends for EWCZ!.
Industry RankSector Rank
Dividend Yield N/A

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EUROPEAN WAX CENTER INC-A

NASDAQ:EWCZ (1/17/2025, 8:00:01 PM)

After market: 6.36 0 (0%)

6.36

+0.01 (+0.16%)

Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryDiversified Consumer Services
Earnings (Last)11-14 2024-11-14/bmo
Earnings (Next)N/A N/A
Inst Owners86.37%
Inst Owner Change0%
Ins Owners0.77%
Ins Owner Change43.2%
Market Cap362.14M
Analysts76
Price Target8.48 (33.33%)
Short Float %6.38%
Short Ratio2.05
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)-2.92%
PT rev (3m)-4.32%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-47.67%
EPS NY rev (1m)0%
EPS NY rev (3m)6.86%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-11.15%
Revenue NY rev (1m)0.01%
Revenue NY rev (3m)0.22%
Valuation
Industry RankSector Rank
PE 13.25
Fwd PE 16.53
P/S 1.32
P/FCF 6.42
P/OCF 6.39
P/B 5.24
P/tB N/A
EV/EBITDA 8.73
EPS(TTM)0.48
EY7.55%
EPS(NY)0.38
Fwd EY6.05%
FCF(TTM)0.99
FCFY15.57%
OCF(TTM)1
OCFY15.65%
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 0.9
F-Score7
WACC9.96%
ROIC/WACC0.58
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-1.93%
EPS Next 3Y3.01%
EPS Next 5Y12.36%
Revenue 1Y (TTM)26.19%
Revenue growth 3Y28.82%
Revenue growth 5YN/A
Sales Q2Q%-0.52%
Revenue Next Year0.09%
Revenue Next 2Y1.21%
Revenue Next 3Y2.19%
Revenue Next 5Y3.78%
EBIT growth 1Y32.76%
EBIT growth 3YN/A
EBIT growth 5YN/A
EBIT Next Year44.85%
EBIT Next 3Y16.59%
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