European Wax Center, Inc.
European Wax Center, Inc. Fundamental Analysis
European Wax Center, Inc. (EWCZ) shows weak financial fundamentals with a PE ratio of 28.99, profit margin of 4.20%, and ROE of 11.41%. The company generates $0.3B in annual revenue with weak year-over-year growth of -4.74%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 21.5/100 based on profitability, valuation, growth, and balance sheet metrics. The F grade reflects weak fundamentals and significant financial concerns.
Fundamental Health Score
We analyze EWCZ's fundamental strength across five key dimensions:
Efficiency Score
WeakEWCZ struggles to generate sufficient returns from assets.
Valuation Score
ModerateEWCZ shows balanced valuation metrics.
Growth Score
WeakEWCZ faces weak or negative growth trends.
Financial Health Score
ModerateEWCZ shows balanced financial health with some risks.
Profitability Score
WeakEWCZ struggles to sustain strong margins.
Key Financial Metrics
Is EWCZ Expensive or Cheap?
P/E Ratio
EWCZ trades at 28.99 times earnings. This indicates a fair valuation.
PEG Ratio
When adjusting for growth, EWCZ's PEG of -1.26 indicates potential undervaluation.
Price to Book
The market values European Wax Center, Inc. at 3.17 times its book value. This suggests the stock is fully valued or overvalued on an asset basis.
EV/EBITDA
Enterprise value stands at 0.11 times EBITDA. This is generally considered low.
How Well Does EWCZ Make Money?
Net Profit Margin
For every $100 in sales, European Wax Center, Inc. keeps $4.20 as profit after all expenses.
Operating Margin
Core operations generate 20.87 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $11.41 in profit for every $100 of shareholder equity.
ROA
European Wax Center, Inc. generates $1.20 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
European Wax Center, Inc. generates strong operating cash flow of $65.98M, reflecting robust business health.
Free Cash Flow
European Wax Center, Inc. generates strong free cash flow of $62.36M, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $1.14 in free cash annually.
FCF Yield
EWCZ converts 15.96% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
28.99
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
-1.26
vs 25 benchmark
P/B Ratio
Price to book value ratio
3.17
vs 25 benchmark
P/S Ratio
Price to sales ratio
1.52
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
4.82
vs 25 benchmark
Current Ratio
Current assets to current liabilities
2.70
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.11
vs 25 benchmark
ROA
Return on assets percentage
0.01
vs 25 benchmark
ROCE
Return on capital employed
0.06
vs 25 benchmark
How EWCZ Stacks Against Its Sector Peers
| Metric | EWCZ Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 28.99 | 22.53 | Worse (Expensive) |
| ROE | 11.41% | 1238.00% | Weak |
| Net Margin | 4.20% | -6235.00% (disorted) | Weak |
| Debt/Equity | 4.82 | 1.25 | Weak (High Leverage) |
| Current Ratio | 2.70 | 2.41 | Strong Liquidity |
| ROA | 1.20% | -157319.00% (disorted) | Weak |
EWCZ outperforms its industry in 1 out of 6 key metrics, but lagging in P/E Ratio.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews European Wax Center, Inc.'s 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
44.48%
Industry Style: Defensive, Dividend, Low Volatility
High GrowthEPS CAGR
129.20%
Industry Style: Defensive, Dividend, Low Volatility
High GrowthFCF CAGR
2643.10%
Industry Style: Defensive, Dividend, Low Volatility
High Growth