Franchise Brands (FRAN) AI Stock Analysis

• Market Cap: £269.55M
• Dividend Yield: 146.91%
• Average Volume (3M): 126.48K
• Price to Earnings (P/E): 37.0
• Beta (1Y): 0.62
• Revenue Growth: 14.79%
• EPS Growth: 165.03%
• Country: UK
• Employees: 646
• Sector: Industrials
• Sector Strength: 94
• Industry: Specialty Business Services
• EPS (TTM): 0.02
• Shares Outstanding: 193,784,070
• 10 Day Avg. Volume: 133,942
• 30 Day Avg. Volume: 126,482
• PEG Ratio: -5.73
• Price to Book (P/B): 1.28
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 11.72
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: £300.00
• Price Target Upside: 114.29% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1

• Rating: 73 Outperform
• Price Target: 162.00p ▲(15.71%Upside)

Franchise Brands' overall stock score is bolstered by strong financial performance and positive corporate events, reflecting solid growth potential and market confidence. However, mixed technical indicators and a high P/E ratio suggest caution, balancing the positive aspects and resulting in a moderate overall score.

Positive Factors

Market Position

Franchise Brands has delivered a resilient performance with record system sales in all key divisions despite challenging macroeconomic conditions.

Operational Strategy

The 'One Franchise Brands' strategic initiative is making good progress to enhance sales, create an efficient overhead structure, and drive operational gearing.

Valuation

The current valuation is seen as compelling, with potential for the company to reach a medium-term market cap of £702m to £810m, significantly higher than the current level.

Negative Factors

Earnings Forecast

Adj. EBITDA is expected to be very marginally below the current consensus range, leading to a slight trim in the forecast.

Franchise Brands Business Overview & Revenue Model

Company Description

Franchise Brands plc, through its subsidiaries, engages in franchising and related activities in the United Kingdom and internationally. It provides vehicle repair services, which comprise bumper scuffs, paintwork scratches, minor dents, and alloy wheel repairs under the ChipsAway brand name; oven cleaning services include cleaning of domestic oven brands and models, such as electric and gas ovens, ranges, microwaves, hobs, extractor fans, and barbecues, as well as various removable components consisting of racks and other removable parts under the Ovenclean brand; and various emergency plumbing services under the Metro Plumb brand name. The company also operates dog home boarding franchise services under the Barking Mad brand; offers drain clearance solutions to commercial customers, including facilities management, construction, manufacturing, education, retail, insurance, water utilities, and public sectors under the Metro Rod brand name; and engages in the design. installation, and maintenance of adoptable and non-adoptable pump stations under the Willow Pumps brand name. It operates 430 franchisees. The company was formerly known as FB Holdings plc. Franchise Brands plc was founded in 2008 and is based in Macclesfield, the United Kingdom.

How the Company Makes Money

Franchise Brands makes money primarily through franchise fees and royalties paid by its franchisees. The company generates revenue by charging an initial franchise fee when a new franchisee is granted the right to operate under one of its brands. Additionally, Franchise Brands earns ongoing royalties based on a percentage of the franchisee's sales. The company also benefits from the sale of products and services to franchisees, which may include equipment, supplies, and marketing support. Strategic partnerships and acquisitions of new brands further contribute to its revenue streams, enabling the company to diversify its portfolio and tap into new markets. Franchise Brands' earnings are significantly influenced by the growth and success of its franchisees, as well as the company's ability to efficiently manage and support its network of franchises.

Franchise Brands Financial Statement Overview

Summary

Franchise Brands demonstrates strong financial performance with robust revenue growth and solid profitability margins. The company maintains a stable balance sheet with moderate leverage, and its cash flow position is robust, supporting future growth opportunities. While ROE could be improved, the company's financial fundamentals are sound, positioning it well within the specialty business services industry.

Income Statement

Franchise Brands has shown robust revenue growth, with a 14.81% increase from the previous year. The gross profit margin is strong at 59.85%, and the net profit margin has improved significantly, reflecting enhanced profitability. EBIT and EBITDA margins are healthy, indicating efficient operations and strong earnings before interest, taxes, depreciation, and amortization.

Balance Sheet

The company maintains a solid equity position with an equity ratio of 58.55%, indicating financial stability. The debt-to-equity ratio is moderate at 0.40, suggesting a balanced approach to leverage. Return on equity is reasonable at 3.33%, though there's room for improvement in maximizing shareholder returns.

Cash Flow

Franchise Brands has displayed strong cash flow management, with a notable 48.08% growth in free cash flow. The operating cash flow to net income ratio is impressive at 3.86, indicating efficient cash generation relative to earnings. Free cash flow to net income is also healthy, reflecting effective capital expenditure management.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	139.21M	121.27M	92.73M	57.69M	49.29M
Gross Profit	83.32M	59.07M	30.79M	21.93M	20.93M
EBITDA	32.81M	23.01M	14.25M	5.87M	5.88M
Net Income	7.28M	3.04M	8.13M	4.23M	2.79M
Balance Sheet
Total Assets	373.30M	382.44M	132.44M	67.27M	68.55M
Cash, Cash Equivalents and Short-Term Investments	12.92M	12.28M	10.80M	9.05M	13.20M
Total Debt	87.98M	94.56M	2.46M	2.53M	8.24M
Total Liabilities	154.74M	168.05M	29.40M	19.94M	24.71M
Stockholders Equity	218.56M	214.39M	103.04M	47.33M	43.84M
Cash Flow
Free Cash Flow	25.02M	16.89M	6.27M	5.12M	4.46M
Operating Cash Flow	28.16M	19.95M	7.73M	7.27M	5.24M
Investing Cash Flow	-2.71M	-51.44M	2.56M	-3.02M	-779.00K
Financing Cash Flow	-24.72M	33.11M	-8.74M	-8.40M	7.06M

Franchise Brands Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 140.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:FRAN, the sentiment is Negative. The current price of 140 is below the 20-day moving average (MA) of 149.69, below the 50-day MA of 149.63, and below the 200-day MA of 148.94, indicating a bearish trend. The MACD of -1.62 indicates Positive momentum. The RSI at 37.20 is Neutral, neither overbought nor oversold. The STOCH value of 17.36 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for GB:FRAN.

Franchise Brands Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
KEYS	78 Outperform	£196.33M	22.84	45.84%	287.92%	13.00%	11.16%
RWS	74 Outperform	£310.64M	12.33	2.82%	1456.14%	-0.78%	―
FRAN	73 Outperform	£269.55M	37.04	3.36%	146.91%	14.79%	165.03%
CPI	69 Neutral	£368.55M	4.76	49.03%	―	-10.33%	―
RST	67 Neutral	£376.54M	30.09	5.32%	192.30%	-0.65%	―
BEG	64 Neutral	£192.85M	30.56	7.85%	338.84%	13.88%	512.00%
Sector *	59 Neutral	AU$1.67B	10.33	11.24%	3.44%	6.75%	3.18%

Franchise Brands Corporate Events

Franchise Brands to Present Interim Results via Investor Meet Company

Franchise Brands plc announced that its Executive Chairman, Stephen Hemsley, and Group CEO, Peter Molloy, along with the management team, will present the company’s interim results on August 1, 2025, via the Investor Meet Company platform. This presentation is open to existing and potential shareholders, allowing them to submit questions before and during the event. This initiative aims to enhance transparency and engagement with investors, potentially strengthening the company’s market position and stakeholder relations.

The most recent analyst rating on (GB:FRAN) stock is a Buy with a £300.00 price target. To see the full list of analyst forecasts on Franchise Brands stock, see the GB:FRAN Stock Forecast page.

Franchise Brands to Announce Interim Results for H1 2025

Franchise Brands plc announced it will release its interim results for the six months ending June 30, 2025, on July 30, 2025. The company will hold a presentation for analysts and investors, indicating a commitment to transparency and engagement with stakeholders, potentially impacting its market perception and investor confidence.

The most recent analyst rating on (GB:FRAN) stock is a Buy with a £300.00 price target. To see the full list of analyst forecasts on Franchise Brands stock, see the GB:FRAN Stock Forecast page.

Franchise Brands Joins FTSE AIM UK 50 Index

Franchise Brands plc has been included in the FTSE AIM UK 50 Index, marking a significant milestone in its growth journey. This inclusion reflects the company’s substantial expansion since its IPO in 2016, now boasting a market capitalization of nearly £300 million. The company is committed to further growth through its ‘One Franchise Brands’ initiative, aiming to integrate and maximize opportunities across its brands, thereby delivering sustainable growth for stakeholders.

The most recent analyst rating on (GB:FRAN) stock is a Buy with a £300.00 price target. To see the full list of analyst forecasts on Franchise Brands stock, see the GB:FRAN Stock Forecast page.

Franchise Brands PLC Announces Change in Shareholder Voting Rights

Franchise Brands PLC, a UK-based company, announced a change in its shareholder voting rights as Swedbank Robur Fonder AB has acquired or disposed of voting rights, crossing the 3% threshold. This change in voting rights, effective from May 27, 2025, could impact the company’s shareholder dynamics and influence its decision-making processes.

The most recent analyst rating on (GB:FRAN) stock is a Buy with a £300.00 price target. To see the full list of analyst forecasts on Franchise Brands stock, see the GB:FRAN Stock Forecast page.

Franchise Brands Enhances Trading Liquidity with SETS Transition

Franchise Brands plc announced the transition of its share trading on AIM from the London Stock Exchange’s SETSqx to SETS, effective May 19, 2025. This move aims to enhance liquidity for investors by providing access to traditional order book trades and two-way quotes from market makers, potentially impacting the company’s market positioning and offering improved trading conditions for stakeholders.

The most recent analyst rating on (GB:FRAN) stock is a Buy with a £300.00 price target. To see the full list of analyst forecasts on Franchise Brands stock, see the GB:FRAN Stock Forecast page.

Franchise Brands Secures Shareholder Support at AGM

Franchise Brands plc announced that all resolutions at its Annual General Meeting were passed, reflecting strong shareholder support. The resolutions included the re-election of key board members and the approval of financial statements, which underscores the company’s stable governance and strategic direction, potentially strengthening its market position and stakeholder confidence.

Franchise Brands PLC Shows Resilience Amid Market Challenges

Franchise Brands PLC reports resilient demand for its essential services and signs of market improvement in its Q1 trading update. Despite challenging macroeconomic conditions, the company has seen growth in system sales, particularly in its Pirtek and Filta North America divisions, and is making progress with strategic initiatives like ‘One Franchise Brands’ to enhance sales and operational efficiency. The company is also diversifying into growth markets to reduce sector dependency.