Bank of America Securities analyst Robert Ohmes reiterated a Buy rating on Driven Brands Holdings (DRVN – Research Report) yesterday and set a price target of $20.00.
Confident Investing Starts Here:
- Easily unpack a company's performance with TipRanks' new KPI Data for smart investment decisions
- Receive undervalued, market resilient stocks right to your inbox with TipRanks' Smart Value Newsletter
Robert Ohmes has given his Buy rating due to a combination of factors including Driven Brands Holdings’ strong financial performance and strategic business decisions. The company reported a significant increase in its adjusted earnings per share for the fourth quarter, surpassing consensus expectations. This growth was largely driven by the Take 5 Oil Change segment, which showed impressive comparable sales growth, indicating robust demand and effective business operations.
Additionally, the sale of the US car wash business has strategically reduced Driven Brands’ exposure to discretionary sectors, allowing the company to focus on its core growth areas such as Take 5 and franchise brands. This move not only provides cash to reduce debt but also aligns with the company’s long-term growth strategy. The focus on organic growth, coupled with deleveraging and re-segmentation efforts, is expected to enhance the company’s valuation, supporting the Buy rating with a price objective of $20.