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FIRST WATCH RESTAURANT GROUP (FWRG) Stock Fundamental Analysis

NASDAQ:FWRG - Nasdaq - US33748L1017 - Common Stock - Currency: USD

19  +0.29 (+1.55%)

Premarket: 18.69 -0.31 (-1.63%)

Fundamental Rating

3

We assign a fundamental rating of 3 out of 10 to FWRG. FWRG was compared to 135 industry peers in the Hotels, Restaurants & Leisure industry. While FWRG is still in line with the averages on profitability rating, there are concerns on its financial health. FWRG is valied quite expensively at the moment, while it does show a decent growth rate.


Dividend Valuation Growth Profitability Health

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4

1. Profitability

1.1 Basic Checks

FWRG had positive earnings in the past year.
In the past year FWRG had a positive cash flow from operations.
The reported net income has been mixed in the past 5 years: FWRG reported negative net income in multiple years.
FWRG had a positive operating cash flow in 4 of the past 5 years.
FWRG Yearly Net Income VS EBIT VS OCF VS FCFFWRG Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2018 2019 2020 2021 2022 2023 0 50M

1.2 Ratios

FWRG has a Return On Assets of 1.41%. This is comparable to the rest of the industry: FWRG outperforms 45.19% of its industry peers.
Looking at the Return On Equity, with a value of 3.54%, FWRG is in line with its industry, outperforming 57.04% of the companies in the same industry.
FWRG's Return On Invested Capital of 2.24% is on the low side compared to the rest of the industry. FWRG is outperformed by 69.63% of its industry peers.
The Average Return On Invested Capital over the past 3 years for FWRG is significantly below the industry average of 15.93%.
The last Return On Invested Capital (2.24%) for FWRG is above the 3 year average (1.90%), which is a sign of increasing profitability.
Industry RankSector Rank
ROA 1.41%
ROE 3.54%
ROIC 2.24%
ROA(3y)0.81%
ROA(5y)-1.43%
ROE(3y)1.81%
ROE(5y)-4.77%
ROIC(3y)1.9%
ROIC(5y)N/A
FWRG Yearly ROA, ROE, ROICFWRG Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2018 2019 2020 2021 2022 2023 0 -5 -10 -15

1.3 Margins

The Profit Margin of FWRG (2.09%) is comparable to the rest of the industry.
FWRG's Operating Margin of 4.85% is on the low side compared to the rest of the industry. FWRG is outperformed by 63.70% of its industry peers.
In the last couple of years the Operating Margin of FWRG has grown nicely.
FWRG has a better Gross Margin (63.06%) than 75.56% of its industry peers.
In the last couple of years the Gross Margin of FWRG has remained more or less at the same level.
Industry RankSector Rank
OM 4.85%
PM (TTM) 2.09%
GM 63.07%
OM growth 3YN/A
OM growth 5Y21.75%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y2.16%
GM growth 5Y-0.41%
FWRG Yearly Profit, Operating, Gross MarginsFWRG Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2018 2019 2020 2021 2022 2023 0 20 40 60

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1

2. Health

2.1 Basic Checks

The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so FWRG is destroying value.
Compared to 1 year ago, FWRG has more shares outstanding
The number of shares outstanding for FWRG has been increased compared to 5 years ago.
Compared to 1 year ago, FWRG has a worse debt to assets ratio.
FWRG Yearly Shares OutstandingFWRG Yearly Shares OutstandingYearly Shares Outstanding 2018 2019 2020 2021 2022 2023 10M 20M 30M 40M 50M
FWRG Yearly Total Debt VS Total AssetsFWRG Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2018 2019 2020 2021 2022 2023 200M 400M 600M 800M 1B

2.2 Solvency

FWRG has an Altman-Z score of 1.45. This is a bad value and indicates that FWRG is not financially healthy and even has some risk of bankruptcy.
FWRG's Altman-Z score of 1.45 is in line compared to the rest of the industry. FWRG outperforms 47.41% of its industry peers.
FWRG has a Debt/Equity ratio of 0.32. This is a healthy value indicating a solid balance between debt and equity.
FWRG has a better Debt to Equity ratio (0.32) than 76.30% of its industry peers.
Industry RankSector Rank
Debt/Equity 0.32
Debt/FCF N/A
Altman-Z 1.45
ROIC/WACC0.25
WACC8.81%
FWRG Yearly LT Debt VS Equity VS FCFFWRG Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2018 2019 2020 2021 2022 2023 0 200M 400M

2.3 Liquidity

A Current Ratio of 0.54 indicates that FWRG may have some problems paying its short term obligations.
FWRG has a Current ratio of 0.54. This is in the lower half of the industry: FWRG underperforms 71.85% of its industry peers.
FWRG has a Quick Ratio of 0.54. This is a bad value and indicates that FWRG is not financially healthy enough and could expect problems in meeting its short term obligations.
With a Quick ratio value of 0.51, FWRG is not doing good in the industry: 71.11% of the companies in the same industry are doing better.
Industry RankSector Rank
Current Ratio 0.54
Quick Ratio 0.51
FWRG Yearly Current Assets VS Current LiabilitesFWRG Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2018 2019 2020 2021 2022 2023 20M 40M 60M 80M 100M

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5

3. Growth

3.1 Past

The earnings per share for FWRG have decreased by -7.22% in the last year.
FWRG shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 19.78%.
The Revenue has been growing by 20.58% on average over the past years. This is a very strong growth!
EPS 1Y (TTM)-7.22%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%-62.22%
Revenue 1Y (TTM)19.78%
Revenue growth 3Y37.57%
Revenue growth 5Y20.58%
Sales Q2Q%14.78%

3.2 Future

FWRG is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 9.75% yearly.
FWRG is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 13.99% yearly.
EPS Next Y-21.49%
EPS Next 2Y1.66%
EPS Next 3Y10%
EPS Next 5Y9.75%
Revenue Next Year14.95%
Revenue Next 2Y15.38%
Revenue Next 3Y14.75%
Revenue Next 5Y13.99%

3.3 Evolution

Although the future Revenue growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
FWRG Yearly Revenue VS EstimatesFWRG Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 500M 1B 1.5B 2B 2.5B
FWRG Yearly EPS VS EstimatesFWRG Yearly EPS VS EstimatesYearly EPS VS Estimates 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 0 0.2 0.4 0.6 0.8 1

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1

4. Valuation

4.1 Price/Earnings Ratio

FWRG is valuated quite expensively with a Price/Earnings ratio of 57.58.
Compared to the rest of the industry, the Price/Earnings ratio of FWRG is on the same level as its industry peers.
The average S&P500 Price/Earnings ratio is at 29.35. FWRG is valued rather expensively when compared to this.
A Price/Forward Earnings ratio of 44.84 indicates a quite expensive valuation of FWRG.
Based on the Price/Forward Earnings ratio, FWRG is valued a bit more expensive than 60.00% of the companies in the same industry.
FWRG is valuated expensively when we compare the Price/Forward Earnings ratio to 22.10, which is the current average of the S&P500 Index.
Industry RankSector Rank
PE 57.58
Fwd PE 44.84
FWRG Price Earnings VS Forward Price EarningsFWRG Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 10 20 30 40 50

4.2 Price Multiples

The rest of the industry has a similar Enterprise Value to EBITDA ratio as FWRG.
Industry RankSector Rank
P/FCF N/A
EV/EBITDA 12.65
FWRG Per share dataFWRG EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 0 5 10 15

4.3 Compensation for Growth

PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y1.66%
EPS Next 3Y10%

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0

5. Dividend

5.1 Amount

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

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FIRST WATCH RESTAURANT GROUP

NASDAQ:FWRG (3/7/2025, 8:00:01 PM)

Premarket: 18.69 -0.31 (-1.63%)

19

+0.29 (+1.55%)

Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryHotels, Restaurants & Leisure
Earnings (Last)11-07 2024-11-07/bmo
Earnings (Next)03-11 2025-03-11/bmo
Inst Owners80.24%
Inst Owner Change1.5%
Ins Owners1.55%
Ins Owner Change0.62%
Market Cap1.15B
Analysts85.88
Price Target24.57 (29.32%)
Short Float %11.61%
Short Ratio9.08
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)1
Avg EPS beat(2)-7.19%
Min EPS beat(2)-26.42%
Max EPS beat(2)12.04%
EPS beat(4)3
Avg EPS beat(4)4.55%
Min EPS beat(4)-26.42%
Max EPS beat(4)23.66%
EPS beat(8)6
Avg EPS beat(8)17.17%
EPS beat(12)9
Avg EPS beat(12)13.68%
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)0
Avg Revenue beat(2)-2.8%
Min Revenue beat(2)-3.75%
Max Revenue beat(2)-1.84%
Revenue beat(4)1
Avg Revenue beat(4)-1.94%
Min Revenue beat(4)-3.75%
Max Revenue beat(4)0.97%
Revenue beat(8)2
Avg Revenue beat(8)-1.33%
Revenue beat(12)6
Avg Revenue beat(12)-0.44%
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)0.76%
PT rev (3m)2.32%
EPS NQ rev (1m)19.35%
EPS NQ rev (3m)75.19%
EPS NY rev (1m)1.07%
EPS NY rev (3m)1.79%
Revenue NQ rev (1m)0.07%
Revenue NQ rev (3m)0.32%
Revenue NY rev (1m)0.1%
Revenue NY rev (3m)0%
Valuation
Industry RankSector Rank
PE 57.58
Fwd PE 44.84
P/S 1.15
P/FCF N/A
P/OCF 10
P/B 1.95
P/tB 54.19
EV/EBITDA 12.65
EPS(TTM)0.33
EY1.74%
EPS(NY)0.42
Fwd EY2.23%
FCF(TTM)-0.07
FCFYN/A
OCF(TTM)1.9
OCFY10%
SpS16.46
BVpS9.73
TBVpS0.35
PEG (NY)N/A
PEG (5Y)N/A
Profitability
Industry RankSector Rank
ROA 1.41%
ROE 3.54%
ROCE 3.58%
ROIC 2.24%
ROICexc 2.33%
ROICexgc 4.13%
OM 4.85%
PM (TTM) 2.09%
GM 63.07%
FCFM N/A
ROA(3y)0.81%
ROA(5y)-1.43%
ROE(3y)1.81%
ROE(5y)-4.77%
ROIC(3y)1.9%
ROIC(5y)N/A
ROICexc(3y)1.99%
ROICexc(5y)N/A
ROICexgc(3y)3.99%
ROICexgc(5y)N/A
ROCE(3y)3.04%
ROCE(5y)N/A
ROICexcg growth 3YN/A
ROICexcg growth 5Y3.36%
ROICexc growth 3YN/A
ROICexc growth 5Y30.47%
OM growth 3YN/A
OM growth 5Y21.75%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y2.16%
GM growth 5Y-0.41%
F-Score5
Asset Turnover0.67
Health
Industry RankSector Rank
Debt/Equity 0.32
Debt/FCF N/A
Debt/EBITDA 1.85
Cap/Depr 219.98%
Cap/Sales 11.95%
Interest Coverage 5.19
Cash Conversion 112.2%
Profit Quality N/A
Current Ratio 0.54
Quick Ratio 0.51
Altman-Z 1.45
F-Score5
WACC8.81%
ROIC/WACC0.25
Cap/Depr(3y)166.88%
Cap/Depr(5y)159.9%
Cap/Sales(3y)8.04%
Cap/Sales(5y)9.11%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-7.22%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%-62.22%
EPS Next Y-21.49%
EPS Next 2Y1.66%
EPS Next 3Y10%
EPS Next 5Y9.75%
Revenue 1Y (TTM)19.78%
Revenue growth 3Y37.57%
Revenue growth 5Y20.58%
Sales Q2Q%14.78%
Revenue Next Year14.95%
Revenue Next 2Y15.38%
Revenue Next 3Y14.75%
Revenue Next 5Y13.99%
EBIT growth 1Y14.84%
EBIT growth 3YN/A
EBIT growth 5Y46.8%
EBIT Next Year186.24%
EBIT Next 3Y55.37%
EBIT Next 5Y36.94%
FCF growth 1Y-136.61%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y76.07%
OCF growth 3YN/A
OCF growth 5Y25.37%