September 08, 2016 - 9:49am EST by
2016 2017
Price: 16.10 EPS 0.90 0.99
Shares Out. (in M): 36 P/E 17.8 16.2
Market Cap (in $M): 585 P/FCF 17.8 16.2
Net Debt (in $M): 191 EBIT 63 68
TEV (in $M): 776 TEV/EBIT 12.4 11.3

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Other Options

·         While I think the company is fairly levered on a lease-adjusted basis, it is still controlled by Advent and they could be willing to use the balance sheet more aggressively to repurchase shares

·         The Blended royalty rate for their franchisees is still relatively low (below 4%); this could be a longer-term lever for earnings

·         Refranchising company-operated stores




·         Build-to-suit leasing strategy (poorly chosen locations)

·         Change in consumer trends towards healthier options

·         Increased wage inflation

·         Continued competitive pressures

·         Lack of attractive locations in adjacent markets

·         Recession causing adjacent-market unit volumes to deteriorate

·         Rising interest rates (floating-rate debt)





I do not hold a position with the issuer such as employment, directorship, or consultancy.
I and/or others I advise hold a material investment in the issuer's securities.


Continued Earnings growth

Improving Same-Store-Sales

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