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Driven Brands Holdings
(NASDAQ:DRVN)
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Rating:59Neutral
Price Target:
$15.50
▲(13.89% Upside)
Action:Reiterated
Date:08/06/26
DRVN scores as a moderate-quality setup: improved profitability and reasonable valuation are offset by a still debt-heavy balance sheet and uneven cash conversion. The earnings-call tone is cautiously optimistic (strength in Take 5, better free cash flow, leverage reduction plan) but tempered by restatement costs, margin pressure, and guidance trending toward the low end. Technical indicators are broadly neutral and do not materially strengthen the case.
Positive Factors
Franchise high margins & diversified model
High-margin franchise royalties and services provide durable cash flow and resilient earnings leverage versus company-operated stores. Franchise economics reduce capital intensity, support margin stability, and create recurring revenue that cushions corporate earnings through local demand cycles over the medium term.
Negative Factors
Elevated leverage
A still-heavy debt load amplifies downside risk if revenue or margins weaken; interest and covenant pressure can constrain reinvestment and M&A optionality. Even with recent improvement, a leveraged capital structure leaves less buffer for cyclical softness or sustained margin compression.
Read all positive and negative factors
Positive Factors
Negative Factors
Franchise high margins & diversified model
High-margin franchise royalties and services provide durable cash flow and resilient earnings leverage versus company-operated stores. Franchise economics reduce capital intensity, support margin stability, and create recurring revenue that cushions corporate earnings through local demand cycles over the medium term.
Read all positive factors
Driven Brands Holdings Key Performance Indicators (KPIs)
Driven Brands Holdings (DRVN) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$2.35B
Dividend YieldN/A
Average Volume (3M)892.97K
Price to Earnings (P/E)12.5
Beta (1Y)0.77
Revenue Growth-11.05%
EPS GrowthN/A
CountryUS
Employees7,100
SectorConsumer Cyclical
Sector Strength84
IndustryAuto - Dealerships
Share Statistics
EPS (TTM)58.47
Shares Outstanding164,955,960
10 Day Avg. Volume665,139
30 Day Avg. Volume892,967
Financial Highlights & Ratios
PEG Ratio-0.12
Price to Book (P/B)3.15
Price to Sales (P/S)1.30
P/FCF Ratio22.39
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$15.50Price Target Upside13.89% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering9
EPS Forecast (FY)1.21
Revenue Forecast (FY)$2.01B
Driven Brands Holdings Business Overview & Revenue Model
Company Description
Driven Brands Holdings Inc., operating through its various subsidiaries, offers a comprehensive suite of automotive services to both individual consumers and business clients across the United States, Canada, and international markets. Their core ...
How the Company Makes Money
Driven Brands makes money primarily through a mix of franchising and company-operated retail operations across its automotive service brands. Key revenue streams include: (1) Retail sales from company-operated locations, where revenue is generated...
Driven Brands Holdings Earnings Call Summary
Earnings Call Date:Aug 06, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 05, 2026
Earnings Call Sentiment Positive
The call presents a cautiously optimistic view: the company delivered continued top-line growth, strong Take 5 performance, improved free cash flow and progress on leverage, demonstrating operational strength and a clear growth strategy. However, material nonrecurring restatement and out-of-period charges, near-term margin pressure, and consumer softness among lower-income cohorts (affecting discretionary brands) temper the outlook and push management to expect results toward the low end of guidance. Overall the positives around growth, cash generation and balance-sheet progress outweigh the near-term accounting and macro headwinds, though with measured caution.Positive Updates
System-wide Sales and Revenue Growth
System-wide sales grew roughly 5% to $1.6 billion in Q2; total revenue was $507.4 million, up ~6.8% year-over-year.
Negative Updates
Significant Restatement and Out-of-Period Costs
Q2 included $11.8 million in nonrecurring restatement costs (YTD $20.9M); company expects total restatement costs at the top end of the previously disclosed $35M–$45M range, pressuring reported results and comparability.
Read all updates
Q2-2026 Updates
Positive
Negative
System-wide Sales and Revenue Growth
System-wide sales grew roughly 5% to $1.6 billion in Q2; total revenue was $507.4 million, up ~6.8% year-over-year.
Read all positive updates
Company Guidance
Driven Brands reiterated full‑year 2026 guidance of $1.95–$2.05 billion in revenue, same‑store sales flat to +2%, 160–190 net new units, adjusted EBITDA $430–$460 million (management expects to trend toward the low end), adjusted diluted EPS $1.15–$1.25, net capex of ~6.5% of revenue and $125–$145 million of free cash flow; the company finished Q2 at 3.1x net leverage and is targeting 3.0x by year‑end, expects restatement costs toward the high end of a $35–$45 million range (YTD restatement costs $20.9M; Q2 included ~$11.8M of restatement charges and ~$4M of out‑of‑period costs), and said it is taking a cautious posture given pressure on lower‑income consumers and geopolitical-driven input cost volatility.Driven Brands Holdings Financial Statement Overview
Summary
Income Statement
67
Positive
Balance Sheet
46
Neutral
Cash Flow
58
Neutral
| Breakdown | TTM | Mar 2026 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 68.24B | 1.86B | 2.34B | 2.30B | 2.03B | 1.47B |
| Gross Profit | 21.08B | 837.39M | 1.23B | 1.03B | 967.51M | 725.01M |
| EBITDA | 13.96B | 303.64M | 27.71M | -506.24M | 329.59M | 223.58M |
| Net Income | 9.60B | 140.16M | -292.50M | -744.96M | 43.19M | 9.63M |
Balance Sheet | ||||||
| Total Assets | 3.54B | 4.16B | 5.26B | 5.91B | 6.50B | 5.86B |
| Cash, Cash Equivalents and Short-Term Investments | 184.05M | 102.94M | 169.95M | 176.52M | 227.11M | 523.41M |
| Total Debt | 2.22B | 2.66B | 4.00B | 4.28B | 3.92B | 3.31B |
| Total Liabilities | 2.71B | 3.39B | 4.65B | 5.00B | 4.85B | 4.21B |
| Stockholders Equity | 833.29M | 767.20M | 607.33M | 906.08M | 1.65B | 1.64B |
Cash Flow | ||||||
| Free Cash Flow | 6.85B | 107.77M | -47.06M | -367.91M | -239.03M | 123.07M |
| Operating Cash Flow | 9.29B | 330.54M | 241.45M | 228.57M | 197.18M | 283.83M |
| Investing Cash Flow | -9.45B | 232.73M | 59.02M | -451.41M | -840.28M | -814.94M |
| Financing Cash Flow | -6.19B | -564.97M | -302.84M | 170.29M | 343.37M | 885.54M |
Driven Brands Holdings Technical Analysis
Negative
13.61
Price Trends
14.05
Negative
13.37
Negative
14.04
Negative
Market Momentum
-0.02
Positive
37.46
Neutral
47.34
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DRVN, the sentiment is Negative. The current price of 13.61 is below the 20-day moving average (MA) of 14.63, below the 50-day MA of 14.05, and below the 200-day MA of 14.04, indicating a bearish trend. The MACD of -0.02 indicates Positive momentum. The RSI at 37.46 is Neutral, neither overbought nor oversold. The STOCH value of 47.34 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for DRVN.
Driven Brands Holdings Risk Analysis
Driven Brands Holdings disclosed 67 risk factors in its most recent earnings report. Driven Brands Holdings reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Driven Brands Holdings Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
69 Neutral | $7.11B | 9.80 | 33.18% | ― | -0.06% | 35.87% | |
66 Neutral | $8.47B | 12.72 | 10.91% | 0.65% | 1.97% | -10.60% | |
66 Neutral | $14.27B | 16.00 | 16.43% | 2.54% | 4.13% | -5.43% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
60 Neutral | $8.13B | 35.57 | 3.67% | ― | -1.69% | -58.01% | |
59 Neutral | $2.35B | 12.52 | 24.44% | ― | -11.05% | ― | |
56 Neutral | $2.89B | 14.35 | 20.45% | 1.55% | 5.25% | 37.36% |
* Consumer Cyclical Sector Average
DRVN
Driven Brands Holdings
12.96
-3.66
-22.02%
AN
AutoNation
211.33
16.93
8.71%
KMX
CarMax
58.06
2.81
5.09%
LAD
Lithia Motors
375.78
85.23
29.34%
PAG
Penske Automotive Group
216.40
45.56
26.66%
SAH
Sonic Automotive
84.89
13.40
18.75%
Driven Brands Holdings Corporate Events
Executive/Board ChangesShareholder Meetings
Driven Brands Shareholders Back Board, Pay and Auditor
Positive
Jul 29, 2026
On July 28, 2026, Driven Brands Holdings Inc. held its annual meeting of stockholders, at which shareholders elected Damien Harmon, Chad Hume and Karen Stroup as Class III directors to serve until the 2029 annual meeting, reinforcing the company&#...
Financial DisclosuresRegulatory Filings and Compliance
Driven Brands Faces Nasdaq Noncompliance Over Delayed 10-Q
Negative
Jun 5, 2026
Driven Brands Holdings Inc. disclosed that on June 1, 2026 it received a notice from Nasdaq stating the company is not in compliance with Nasdaq Listing Rule 5250(c)(1) because it has not yet filed its Form 10-Q for the quarter ended March 28, 202...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.