European Wax Center (NASDAQ:EWCZ) Posts Better-Than-Expected Sales In Q3

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European Wax Center (NASDAQ:EWCZ) Posts Better-Than-Expected Sales In Q3 Beauty and waxing service franchise European Wax Center (NASDAQ:EWCZ) reported Q3 CY2024 results topping the market’s ...

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The company expects the full year’s revenue to be around $218.5 million, close to analysts’ estimates. Its GAAP profit of $0.05 per share was in line with analysts’ consensus estimates.Is now the time to buy European Wax Center?Gross Margin : 72.9%, up from 71.8% in the same quarter last year. Operating Margin: 17.1%, down from 22.4% in the same quarter last year. EBITDA Margin: 33.2%, down from 34.6% in the same quarter last year. Free Cash Flow Margin: 26.6%, down from 31.4% in the same quarter last year. Long-term growth is the most important, but within consumer discretionary, p","collect":0,"end_time":0,"defaultTopTitle":"yahoo.com","property":["earning"],"viewcount":null,"language":"en","relate_stocks":{"EWCZ":"European Wax Center, Inc.","NDAQ":"纳斯达克OMX交易所",".IXIC":"NASDAQ Composite"},"translate_title":"欧洲蜡中心（纳斯达克：EWCZ）第三季度销售额好于预期","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{".IXIC":1,"EWCZ":1,"NDAQ":1},"content_text":"European Wax Center (NASDAQ:EWCZ) Posts Better-Than-Expected Sales In Q3 \n \n\nBeauty and waxing service franchise European Wax Center (NASDAQ:EWCZ) reported Q3 CY2024 results topping the market’s revenue expectations , but sales were flat year on year at $55.43 million. The company expects the full year’s revenue to be around $218.5 million, close to analysts’ estimates. Its GAAP profit of $0.05 per share was in line with analysts’ consensus estimates. \nIs now the time to buy European Wax Center? Find out in our full research report.\n\nEuropean Wax Center (EWCZ) Q3 CY2024 Highlights:\n\nRevenue: $55.43 million vs analyst estimates of $54.16 million (2.3% beat)\nAdjusted EPS: $0.05 vs analyst estimates of $0.05 (in line) \nAdjusted EBITDA: $18.41 million vs analyst estimates of $16.74 million (10% beat)\nThe company reconfirmed its revenue guidance for the full year of $218.5 million at the midpoint\n EBITDA guidance for the full year is $72 million at the midpoint, in line with analyst expectations\nGross Margin (GAAP): 72.9%, up from 71.8% in the same quarter last year\nOperating Margin: 17.1%, down from 22.4% in the same quarter last year\nEBITDA Margin: 33.2%, down from 34.6% in the same quarter last year\nFree Cash Flow Margin: 26.6%, down from 31.4% in the same quarter last year\nSame-Store Sales were flat year on year (3.4% in the same quarter last year)\nMarket Capitalization: $382.6 million\n\n\nDavid Berg, Executive Chairman and CEO of European Wax Center, Inc. stated, “We are pleased that our third quarter results were in line with the revised expectations we provided in August. Over the past three months, I’ve been immersing myself in the business, refining our key focus areas and developing a robust action plan focused on driving new guests and ticket growth. Over time, we believe our efforts will enhance unit economics and financial returns for our franchise partners, enable thoughtful growth for European Wax Center, and deliver long-term value to our stakeholders.”\nCompany Overview\nFounded by two siblings, European Wax Center (NASDAQ:EWCZ) is a beauty and waxing salon chain specializing in professional wax services and skincare products. \nLeisure Facilities\nLeisure facilities companies often sell experiences rather than tangible products, and in the last decade-plus, consumers have slowly shifted their spending from \"things\" to \"experiences\". Leisure facilities seek to benefit but must innovate to do so because of the industry's high competition and capital intensity. \nSales Growth\nExamining a company’s long-term performance can provide clues about its business quality. Any business can put up a good quarter or two, but the best consistently grow over the long haul. Regrettably, European Wax Center’s sales grew at a sluggish 6.7% compounded annual growth rate over the last five years. This shows it couldn’t expand in any major way, a rough starting point for our analysis. \n\nLong-term growth is the most important, but within consumer discretionary, product cycles are short and revenue can be hit-driven due to rapidly changing trends and consumer preferences. European Wax Center’s annualized revenue growth of 6% over the last two years aligns with its five-year trend, suggesting its demand was consistently weak. Note that COVID hurt European Wax Center’s business in 2020 and part of 2021, and it bounced back in a big way thereafter. \nWe can better understand the company’s revenue dynamics by analyzing its same-store sales, which show how much revenue its established locations generate. Over the last two years, European Wax Center’s same-store sales averaged 2.3% year-on-year growth. Because this number is lower than its revenue growth, we can see the opening of new locations is boosting the company’s top-line performance. \nThis quarter, European Wax Center’s $55.43 million of revenue was flat year on year but beat Wall Street’s estimates by 2.3%. \nLooking ahead, sell-side analysts expect revenue to remain flat over the next 12 months, a deceleration versus the last two years. This projection is underwhelming and suggests its products and services will face some demand challenges. \nWhen a company has more cash than it knows what to do with, buying back its own shares can make a lot of sense–as long as the price is right. Luckily, we’ve found one, a low-priced stock that is gushing free cash flow AND buying back shares. Click here to claim your Special Free Report on a fallen angel growth story that is already recovering from a setback.\nCash Is King\nAlthough earnings are undoubtedly valuable for assessing company performance, we believe cash is king because you can’t use accounting profits to pay the bills. \nEuropean Wax Center has shown terrific cash profitability, enabling it to reinvest, return capital to investors, and stay ahead of the competition while maintaining an ample cushion. The company’s free cash flow margin was among the best in the consumer discretionary sector, averaging 25.1% over the last two years. \n\nEuropean Wax Center’s free cash flow clocked in at $14.76 million in Q3, equivalent to a 26.6% margin. The company’s cash profitability regressed as it was 4.8 percentage points lower than in the same quarter last year, but it’s still above its two-year average. We wouldn’t read too much into this quarter’s decline because investment needs can be seasonal, causing short-term swings. Long-term trends carry greater meaning. \nKey Takeaways from European Wax Center’s Q3 Results\nWe were impressed that European Wax Center beat analysts’ revenue and EPS expectations this quarter. It was a solid quarter. The stock remained flat at $7.99 immediately following the results. \nSo do we think European Wax Center is an attractive buy at the current price? When making that decision, it’s important to consider its valuation, business qualities, as well as what has happened in the latest quarter. We cover that in our actionable full research report which you can read here, it’s free.","kind":null,"is_publish_news":true,"is_publish_highlight":false,"is_publish_live":false,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"1","news_tag":"","news_rank":0,"symbols":[],"gpt_button":1},"commentList":[],"isCommentEnd":true,"newsSizeData":{"likeSize":0,"commentSize":0,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.29.1","shortVersion":"4.29.1","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/2483803786"}