European Wax Center (EWCZ) AI Stock Analysis

• Market Cap: $219.07M
• Dividend Yield: N/A
• Average Volume (3M): 374.57K
• Price to Earnings (P/E): 15.2
• Beta (1Y): 1.94
• Revenue Growth: -5.47%
• EPS Growth: 13.42%
• Country: US
• Employees: 124
• Sector: Consumer Defensive
• Sector Strength: 42
• Industry: Household & Personal Products
• EPS (TTM): 0.21
• Shares Outstanding: 43,692,900
• 10 Day Avg. Volume: 329,020
• 30 Day Avg. Volume: 374,571
• PEG Ratio: 1.02
• Price to Book (P/B): 4.88
• Price to Sales (P/S): 1.44
• P/FCF Ratio: 5.58
• Enterprise Value/Market Cap: 2.28
• Enterprise Value/Revenue: 2.36
• Enterprise Value/Gross Profit: 3.41
• Enterprise Value/Ebitda: 7.50
• 1Y Price Target: $5.00
• Price Target Upside: 25.94% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 3
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 61 Neutral
• Price Target: $4.00 ▲(0.76% Upside)

The score is driven primarily by solid profitability and strong cash flow conversion, tempered by leverage risk and weak/negative recent revenue growth. Earnings call takeaways are balanced: reaffirmed guidance and margin expansion are positives, but sales pressure from closures and weak new guest acquisition add risk. Technicals are mixed with short-term improvement but negative MACD and a price still below the 200-day average, while valuation appears moderate with no dividend support.

Positive Factors

High gross and operating margins

A sustained gross profit margin above 71% and healthy EBIT/EBITDA margins indicate durable unit economics and pricing power in a service-led franchise model. Strong margins provide buffer for reinvestment, franchisee support and profitability even with moderate top-line pressures.

Strong free cash flow conversion

Almost one-to-one conversion of net income into free cash flow shows efficient cash generation. This enhances ability to service debt, fund targeted store initiatives, support franchisor investments and maintain flexibility to pursue disciplined growth without relying solely on external financing.

Recurring, asset-light franchise model

A royalty-driven, asset-light franchisor model creates recurring revenue with low capital intensity and scalability. Standardized training and proprietary products help sustain brand consistency, drive repeat visits and allow margin expansion as system-wide scale increases over time.

Negative Factors

Recent revenue contraction

Material negative recent revenue growth signals weakening top-line momentum that can erode royalty streams and slow EBITDA expansion. If persistent, declining system sales will pressure franchise economics, limit organic royalty upside and require more investment to restore guest traffic.

High financial leverage

A high debt-to-equity profile raises fixed interest and refinancing obligations, reducing strategic flexibility. Elevated leverage constrains capacity to fund growth initiatives, increases vulnerability to economic shocks, and can limit support for franchisees during localized weakness.

Weak new guest acquisition and regional pockets of weakness

Prolonged challenges in recruiting new guests and regional underperformance (e.g., NY, Philadelphia, DC) undermine sustainable traffic growth. This limits royalty base expansion, may force higher marketing spend, and risks longer-term softness in same-store sales and unit economics.

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

European Wax Center shows strong operational efficiency and cash flow generation, but faces challenges with revenue growth and high leverage. The company's ability to maintain profitability and manage debt levels will be crucial for future stability and growth.

Income Statement

The income statement shows a mixed performance. While the company has maintained a healthy gross profit margin of over 71% in TTM, revenue growth has been negative recently, indicating potential challenges in market expansion. The net profit margin has decreased slightly, reflecting some pressure on profitability. However, EBIT and EBITDA margins remain strong, suggesting operational efficiency.

Balance Sheet

The balance sheet reveals a high debt-to-equity ratio, which poses a risk due to significant leverage. However, the company has shown a reasonable return on equity, indicating effective use of shareholder funds. The equity ratio is relatively low, suggesting a reliance on debt financing, which could impact financial stability.

Cash Flow

Cash flow analysis indicates strong free cash flow growth and a solid operating cash flow to net income ratio, demonstrating good cash generation capabilities. The free cash flow to net income ratio is nearly 1, reflecting efficient conversion of earnings into cash. These factors contribute to a robust cash flow position.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	211.26M	216.92M	221.02M	207.35M	178.68M	103.41M
Gross Profit	146.53M	159.60M	158.39M	148.12M	131.84M	67.90M
EBITDA	66.56M	62.64M	65.03M	60.51M	44.70M	17.41M
Net Income	11.24M	10.46M	8.70M	7.31M	6.91M	-21.50M
Balance Sheet
Total Assets	720.70M	707.07M	734.12M	716.03M	613.44M	606.90M
Cash, Cash Equivalents and Short-Term Investments	73.60M	49.73M	52.73M	44.22M	43.30M	36.72M
Total Debt	382.19M	380.82M	380.39M	380.47M	178.23M	265.40M
Total Liabilities	615.89M	615.48M	619.11M	585.73M	272.20M	288.88M
Stockholders Equity	78.11M	64.05M	82.02M	79.00M	179.39M	318.02M
Cash Flow
Free Cash Flow	59.35M	55.98M	54.82M	44.11M	33.14M	-35.45M
Operating Cash Flow	61.76M	56.51M	55.60M	44.35M	41.35M	1.40M
Investing Cash Flow	-2.42M	-386.00K	-785.00K	-245.00K	-8.20M	-36.84M
Financing Cash Flow	-33.83M	-59.15M	-46.38M	-36.62M	-26.56M	61.90M

European Wax Center Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 3.97
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

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 3.97 is above the 20-day moving average (MA) of 3.78, above the 50-day MA of 3.80, and below the 200-day MA of 4.26, indicating a neutral trend. The MACD of <0.01 indicates Negative momentum. The RSI at 57.21 is Neutral, neither overbought nor oversold. The STOCH value of 92.84 is Negative, 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
Sector *	62 Neutral	$20.33B	14.63	-3.31%	3.23%	1.93%	-12.26%
NUS	61 Neutral	$491.40M	4.74	14.55%	2.39%	-12.10%	―
EWCZ	61 Neutral	$219.07M	15.22	15.38%	―	-5.47%	13.42%
EPC	58 Neutral	$789.02M	33.15	1.62%	3.51%	-1.34%	-73.59%
SKIN	51 Neutral	$183.60M	-7.06	-18.73%	―	-13.14%	57.98%
SLSN	50 Neutral	$105.81M	109.29	6.60%	―	30.04%	-53.50%
HELE	46 Neutral	$485.45M	-0.60	-63.90%	―	-5.64%	-577.74%

European Wax Center Corporate Events

European Wax Center CAO Gavin O’Connor Resigns

On October 14, 2025, Gavin M. O’Connor announced his resignation from European Wax Center, Inc., where he served as Chief Administrative Officer, General Counsel, and Corporate Secretary. His departure, effective November 7, 2025, marks a significant change in the company’s leadership as he transitions to a new role at another company.

The most recent analyst rating on (EWCZ) stock is a Hold with a $4.60 price target. To see the full list of analyst forecasts on European Wax Center stock, see the EWCZ Stock Forecast page.