European Wax Center (EWCZ) AI Stock Analysis

• Market Cap: $313.89M
• Dividend Yield: N/A
• Average Volume (3M): 374.57K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.83
• Revenue Growth: -5.47%
• EPS Growth: 13.42%
• Country: US
• Employees: 124
• Sector: Consumer Defensive
• Sector Strength: 42
• Industry: Household & Personal Products
• EPS (TTM): -0.02
• Shares Outstanding: 44,017,970
• 10 Day Avg. Volume: 329,020
• 30 Day Avg. Volume: 374,571
• PEG Ratio: 0.00
• Price to Book (P/B): 0.00
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: 0.78
• Enterprise Value/Revenue: 1.18
• Enterprise Value/Gross Profit: 1.60
• Enterprise Value/Ebitda: 4.07
• 1Y Price Target: $5.80
• Price Target Upside: 1.22% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 4
• EPS Forecast (FY): 0.66
• Revenue Forecast (FY): $211.85M

• Rating: 64 Neutral
• Price Target: $6.00 ▲(4.71% Upside)
• Action: Reiterated Date: 03/05/26
• Date: Action: Reiterated 03/05/26

The score is primarily supported by solid profitability and strong cash flow, with technicals showing an uptrend. It is held back by slowing/recently negative revenue trends, prior multi-year leverage risk (despite improvement), and limited valuation visibility from the provided P/E and dividend data. The pending take-private transaction adds a positive corporate catalyst, while earnings-call commentary remains mixed due to sales and new-guest challenges.

Positive Factors

Franchise-driven recurring revenue

An asset-light, franchise-heavy model generates recurring royalty and fee income plus product sales into the network. This creates predictable cash flows, scalable unit economics and alignment with franchisees that support durable earnings and lower capital intensity over multiple years.

Consistent strong cash generation

Sustained operating and free cash flow gives the company flexibility to support franchise initiatives, invest in marketing and product development, and pay down debt. Strong cash conversion signals earnings quality and underpins strategic choices over the next 2–6 months and beyond.

High and durable margin profile

Elevated gross and EBITDA margins provide a structural profitability buffer that sustains franchisee economics and corporate operating cash flow. Margin durability supports reinvestment in guest acquisition and franchisee support without requiring large revenue expansion for healthy cash generation.

Negative Factors

Recent revenue and system-wide sales weakness

A negative revenue trend and declining system-wide sales pressure royalty income and limit operating leverage. Persistent top-line softness reduces ability to translate strong margins into net income growth and constrains franchise development returns over the medium term.

Weakness in new guest acquisition

Failure to sustainably restore new-guest flow is a structural growth headwind for a service business reliant on repeat visits. Sluggish new-customer recovery hampers same-store sales, reduces future royalty growth and increases pressure on marketing investment to regain long-term traffic trends.

Historic multi-year high leverage risk

Although debt levels materially improved in 2026, the multi-year history of heavy leverage raises concerns about past constraint on investment and covenant risk. A thin equity base relative to historical liabilities can leave the company sensitive to earnings volatility and credit-market access.

European Wax Center Business Overview & Revenue Model

Company Description

European Wax Center, Inc. operates as the franchisor and operator of out-of-home waxing services in the United States. The company offers body and facial waxing services; and pre- and post-service products, including ingrown hair serums, exfoliating gels, brow shapers, and skin treatments. As of March 26, 2022, it had a portfolio of centers operating in 874 locations across 44 states, including 868 franchised centers and six corporate-owned centers. European Wax Center, Inc. was founded in 2004 and is headquartered in Plano, Texas.

How the Company Makes Money

European Wax Center primarily generates revenue through its core services of body waxing. Customers pay for individual waxing services, which are priced based on the type of treatment and body area. In addition to service revenue, EWCZ also earns money through the sale of its exclusive line of skin care products designed to enhance and maintain the results of waxing treatments. The company operates on a franchise model, allowing it to expand its footprint while earning franchise fees and a percentage of sales from franchisees. Partnerships with suppliers for high-quality wax and skin care products also contribute to cost efficiencies and revenue stability. Overall, EWCZ's revenue model is driven by both service and product sales, alongside franchise operations, creating a diversified income stream.

European Wax Center Financial Statement Overview

Summary

Profitability and cash generation are strong (high gross margin ~71%–74%, EBITDA margin ~25%–29%, and consistently solid operating/free cash flow), but the latest revenue softness (negative trend in 2025–2026) and the historically high leverage profile in 2022–2025 (despite sharp improvement in 2026) meaningfully cap the score.

Income Statement

Profitability is solid for the category, with consistently high gross margins (~71%–74%) and strong EBITDA margins (~25%–29%) across recent annual periods. That said, growth has clearly slowed: revenue has turned slightly negative in 2025 and fell further in 2026, and net margin remains modest (~4%–5%), limiting earnings leverage. Results are improved versus 2020’s loss-making year, but the latest revenue and net income softness keeps the score from being higher.

Balance Sheet

Leverage has been a key swing factor. The company carried very high debt relative to equity in 2022–2025 (debt-to-equity ~4.6x–5.9x), which is a meaningful financial risk even with acceptable returns on equity (~9%–16%). The 2026 balance sheet shows a sharp improvement with much lower debt (debt-to-equity ~0.09x), which strengthens flexibility, but the prior multi-year leverage profile and still-low equity relative to total assets temper the overall balance sheet score.

Cash Flow

Cash generation is a standout strength. Operating cash flow has been consistently strong in 2021–2026 (roughly $41M–$57M annually) and free cash flow has remained robust and close to net income in most years, indicating good earnings quality. However, free cash flow declined in 2026 (down ~15.6%), and the business showed vulnerability in 2020 with weak operating cash flow and negative free cash flow, which slightly reduces the score despite the strong recent run-rate.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	206.63M	216.92M	221.02M	207.35M	178.68M
Gross Profit	152.79M	159.60M	158.39M	148.12M	131.84M
EBITDA	60.13M	62.64M	65.03M	60.51M	44.70M
Net Income	8.68M	10.46M	8.70M	7.31M	6.91M
Balance Sheet
Total Assets	725.26M	707.07M	734.12M	716.03M	613.44M
Cash, Cash Equivalents and Short-Term Investments	76.06M	49.73M	52.73M	44.22M	43.30M
Total Debt	7.48M	380.82M	380.39M	380.47M	178.23M
Total Liabilities	620.39M	615.48M	619.11M	585.73M	272.20M
Stockholders Equity	79.27M	64.05M	82.02M	79.00M	179.39M
Cash Flow
Free Cash Flow	50.09M	55.98M	54.82M	44.11M	33.14M
Operating Cash Flow	53.00M	56.51M	55.60M	44.35M	41.35M
Investing Cash Flow	-2.91M	-386.00K	-785.00K	-245.00K	-8.20M
Financing Cash Flow	-23.80M	-59.15M	-46.38M	-36.62M	-26.56M

European Wax Center Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 5.73
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Negative
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For EWCZ, the sentiment is Positive. The current price of 5.73 is above the 20-day moving average (MA) of 5.37, above the 50-day MA of 4.47, and above the 200-day MA of 4.47, indicating a bullish trend. The MACD of 0.40 indicates Positive momentum. The RSI at 79.63 is Negative, neither overbought nor oversold. The STOCH value of 68.18 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for EWCZ.

European Wax Center Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
EWCZ	64 Neutral	$313.89M	―	15.38%	―	-5.47%	13.42%
Sector *	62 Neutral	$20.33B	14.63	-3.31%	3.23%	1.93%	-12.26%
NUS	58 Neutral	$363.84M	2.96	22.00%	2.39%	-12.10%	―
EPC	52 Neutral	$1.00B	-3.02	1.62%	3.51%	-1.34%	-73.59%
SKIN	51 Neutral	$137.70M	-5.72	-18.73%	―	-13.14%	57.98%
SLSN	49 Neutral	$83.23M	-50.67	6.60%	―	30.04%	-53.50%
HELE	46 Neutral	$390.61M	-1.34	-63.90%	―	-5.64%	-577.74%

European Wax Center Corporate Events

European Wax Center to Be Taken Private by General Atlantic

On February 9, 2026, European Wax Center entered into a definitive merger agreement under which an affiliate of General Atlantic, already a 42% shareholder, will acquire all remaining Class A shares it does not own and take the U.S. waxing franchisor private. Unaffiliated holders of Class A common stock will receive $5.80 per share in cash, implying an equity value of about $330 million and representing a 45% premium to the February 9 closing price and a 51% premium to the 90-day volume-weighted average.

The deal, unanimously recommended by an independent special committee and approved by the board, includes cash-out treatment for equity awards, appraisal rights for dissenting holders and customary no-shop, termination fee and reverse termination fee provisions. Closing, targeted for mid-2026, remains subject to approval by a majority of disinterested shareholders, regulatory clearances under U.S. antitrust law and other conditions, after which the stock will be delisted from Nasdaq and the company will operate as a privately held, General Atlantic–backed business.

The most recent analyst rating on (EWCZ) stock is a Hold with a $4.50 price target. To see the full list of analyst forecasts on European Wax Center stock, see the EWCZ Stock Forecast page.