El Pollo Loco Holdings, Inc.
El Pollo Loco Holdings, Inc. Fundamental Analysis
El Pollo Loco Holdings, Inc. (LOCO) shows weak financial fundamentals with a PE ratio of 12.22, profit margin of 5.39%, and ROE of 9.56%. The company generates $0.5B in annual revenue with weak year-over-year growth of 0.93%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 28.7/100 based on profitability, valuation, growth, and balance sheet metrics. The F grade reflects weak fundamentals and significant financial concerns.
Fundamental Health Score
We analyze LOCO's fundamental strength across five key dimensions:
Efficiency Score
WeakLOCO struggles to generate sufficient returns from assets.
Valuation Score
ModerateLOCO shows balanced valuation metrics.
Growth Score
ModerateLOCO shows steady but slowing expansion.
Financial Health Score
ModerateLOCO shows balanced financial health with some risks.
Profitability Score
WeakLOCO struggles to sustain strong margins.
Key Financial Metrics
Is LOCO Expensive or Cheap?
P/E Ratio
LOCO trades at 12.22 times earnings. This suggests potential undervaluation.
PEG Ratio
When adjusting for growth, LOCO's PEG of 2.57 indicates potential overvaluation.
Price to Book
The market values El Pollo Loco Holdings, Inc. at 1.12 times its book value. This may indicate undervaluation.
EV/EBITDA
Enterprise value stands at 1.47 times EBITDA. This is generally considered low.
How Well Does LOCO Make Money?
Net Profit Margin
For every $100 in sales, El Pollo Loco Holdings, Inc. keeps $5.39 as profit after all expenses.
Operating Margin
Core operations generate 8.64 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $9.56 in profit for every $100 of shareholder equity.
ROA
El Pollo Loco Holdings, Inc. generates $4.30 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
El Pollo Loco Holdings, Inc. generates limited operating cash flow of $40.80M, signaling weaker underlying cash strength.
Free Cash Flow
El Pollo Loco Holdings, Inc. produces free cash flow of $22.03M, offering steady but limited capital for shareholder returns and expansion.
FCF Per Share
Each share generates $0.74 in free cash annually.
FCF Yield
LOCO converts 6.62% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
12.22
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
2.57
vs 25 benchmark
P/B Ratio
Price to book value ratio
1.12
vs 25 benchmark
P/S Ratio
Price to sales ratio
0.67
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.89
vs 25 benchmark
Current Ratio
Current assets to current liabilities
0.41
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.10
vs 25 benchmark
ROA
Return on assets percentage
0.04
vs 25 benchmark
ROCE
Return on capital employed
0.08
vs 25 benchmark
How LOCO Stacks Against Its Sector Peers
| Metric | LOCO Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 12.22 | 25.25 | Better (Cheaper) |
| ROE | 9.56% | 1170.00% | Weak |
| Net Margin | 5.39% | 742.00% | Weak |
| Debt/Equity | 0.89 | 0.77 | Neutral |
| Current Ratio | 0.41 | 9.19 | Weak Liquidity |
| ROA | 4.30% | -6467.00% (disorted) | Weak |
LOCO outperforms its industry in 1 out of 6 key metrics, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews El Pollo Loco Holdings, Inc.'s 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
31.62%
Industry Style: Cyclical, Growth, Discretionary
High GrowthEPS CAGR
26.95%
Industry Style: Cyclical, Growth, Discretionary
High GrowthFCF CAGR
59.34%
Industry Style: Cyclical, Growth, Discretionary
High Growth