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Mister Car Wash (MCW)
NASDAQ:MCW
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Mister Car Wash
(NASDAQ:MCW)
67Neutral
Positive Factors
Earnings
Mister Car Wash's strong fourth-quarter performance exceeded expectations in both sales and earnings.
Financial Performance
The company's revenues have expanded by 9.1%, reaching the upper end of guidance and slightly outpacing consensus.
Market Position
Mister Car Wash is well positioned to take advantage of attractive assets coming to market due to shifting competitive dynamics.
Negative Factors
Operating Costs
Higher rent, utility, and maintenance costs led to increased operating expenses in Q4, posing a challenge to profitability.
Stock Performance
The shares have declined 8% over the past year.
Mister Car Wash (MCW) vs. S&P 500 (SPY)
Market Cap
$2.62B
Dividend YieldN/A
Average Volume (3M)1.55M
Price to Earnings (P/E)38.0
Beta (1Y)1.60
Revenue Growth7.30%
EPS Growth-14.92%
CountryUS
Employees6,640
SectorConsumer Cyclical
Sector Strength49
IndustryPersonal Services
Share Statistics
EPS (TTM)0.21
Shares Outstanding324,053,920
10 Day Avg. Volume1,348,362
30 Day Avg. Volume1,552,172
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)2.64
Price to Cash Flow (P/CF)13.20
P/FCF Ratio0.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$9.50Price Target Upside17.28% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering13
Mister Car Wash Business Overview & Revenue Model
Company DescriptionMister Car Wash (MCW) is a leading provider in the car wash industry, offering comprehensive car cleaning services. The company operates in the automotive services sector, focusing primarily on express exterior and interior car wash services. Mister Car Wash sets itself apart with a commitment to customer satisfaction and convenience, featuring state-of-the-art wash technology and eco-friendly practices.
How the Company Makes MoneyMister Car Wash generates revenue primarily through its network of car wash locations, offering a range of services such as express exterior washes, full-service interior cleaning, and additional detailing options. The company employs a membership model, where customers can subscribe to unlimited wash packages for a monthly fee, which provides a steady stream of recurring revenue. Additionally, Mister Car Wash earns income from one-time wash services and the sale of ancillary products like car care items and air fresheners. Strategic partnerships and real estate ownership of certain locations also play a role in its financial performance, contributing to operational efficiency and cost management.
Mister Car Wash Financial Statement Overview
Summary
Mister Car Wash has shown strong revenue growth but faces profitability challenges with declining net income and high leverage. The positive cash flow from operations is offset by negative free cash flow due to significant capital expenditures.Income Statement
Mister Car Wash has shown consistent revenue growth, with a notable increase from $574.9 million in 2020 to $994.7 million in 2024, indicating strong sales performance. The Net Profit Margin for 2024 is approximately 7.06%, a decline from previous years, suggesting potential pressure on profitability. The Gross Profit Margin has remained steady, but the decline in Net Income from 2023 to 2024 highlights some weakness in cost management or increased expenses.68
Positive
Balance Sheet
The company maintains a high Debt-to-Equity ratio, which was approximately 0.96 in 2024, indicating a significant reliance on debt financing. The Return on Equity (ROE) has decreased to 7.03% in 2024 from 8.76% in 2023, reflecting reduced profitability relative to shareholders' equity, though the Equity Ratio improved slightly, indicating a healthier balance between equity and total assets.62
Positive
Cash Flow
Operating Cash Flow has increased over the years, reaching $248.6 million in 2024, reflecting robust cash generation. However, Free Cash Flow remains negative in 2024 at -$81.46 million, primarily due to high capital expenditures, which could be a concern for liquidity and future investment capacity. The Operating Cash Flow to Net Income ratio is strong, suggesting good cash conversion, but high capital expenditures limit Free Cash Flow stability.59
Neutral
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 994.73M | 927.07M | 876.51M | 758.36M | 574.94M | Gross Profit |
| 704.02M | 563.35M | 608.04M | 493.19M | 380.97M | EBIT |
| 178.93M | 178.15M | 187.72M | -27.70M | 105.21M | EBITDA |
| 178.93M | 248.14M | 187.72M | 42.84M | 220.75M | Net Income Common Stockholders |
| 70.24M | 80.13M | 112.90M | -22.05M | 60.40M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 67.46M | 19.05M | 65.15M | 19.74M | 114.65M | Total Assets |
| 3.10B | 2.88B | 2.69B | 2.45B | 1.95B | Total Debt |
| 960.59M | 1.77B | 1.71B | 1.67B | 1.80B | Net Debt |
| 893.12M | 1.75B | 1.65B | 1.65B | 1.68B | Total Liabilities |
| 2.10B | 1.97B | 1.89B | 1.79B | 1.93B | Stockholders Equity |
| 998.35M | 915.03M | 801.13M | 657.15M | 16.65M |
| Cash Flow | Free Cash Flow | |||
| -81.46M | -123.47M | 37.59M | 47.59M | 43.10M | Operating Cash Flow |
| 248.62M | 204.65M | 229.20M | 173.35M | 101.85M | Investing Cash Flow |
| -199.85M | -259.37M | -190.13M | -543.83M | -13.35M | Financing Cash Flow |
| -275.00K | 8.61M | 6.29M | 272.46M | 22.68M |
Mister Car Wash Technical Analysis
Positive
8.10
Price Trends
7.73
Positive
7.67
Positive
7.21
Positive
Market Momentum
0.10
Negative
56.30
Neutral
80.73
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MCW, the sentiment is Positive. The current price of 8.1 is above the 20-day moving average (MA) of 7.96, above the 50-day MA of 7.73, and above the 200-day MA of 7.21, indicating a bullish trend. The MACD of 0.10 indicates Negative momentum. The RSI at 56.30 is Neutral, neither overbought nor oversold. The STOCH value of 80.73 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for MCW.
Mister Car Wash Risk Analysis
Mister Car Wash disclosed 28 risk factors in its most recent earnings report. Mister Car Wash 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
Mister Car Wash Peers Comparison
Overall Rating
UnderperformOutperform
Sector (59)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
73 Outperform | $59.97B | 24.19 | -14.95% | ― | 4.72% | 4.69% | |
70 Outperform | $76.93B | 32.93 | -174.09% | ― | 5.67% | 5.40% | |
67 Neutral | $2.62B | 37.97 | 7.34% | ― | 7.30% | -14.92% | |
65 Neutral | $16.76B | 18.65 | 20.69% | 3.31% | 1.71% | -30.78% | |
59 Neutral | $12.39B | 11.01 | 1.61% | 3.72% | 1.31% | -19.92% | |
45 Neutral | $2.25B | 59.62 | -23.45% | 2.66% | -9.34% | -852.37% | |
41 Neutral | $2.03B | 8.26 | 78.26% | ― | -1.82% | -219.91% |
* Consumer Cyclical Sector Average
Performance Comparison
MCW
Mister Car Wash
8.10
0.70
9.46%
AAP
Advance Auto Parts
37.46
-45.16
-54.66%
AZO
AutoZone
3,606.34
435.52
13.74%
CAR
Avis Budget
60.65
-57.82
-48.81%
GPC
Genuine Parts Company
118.78
-30.21
-20.28%
ORLY
O'Reilly Auto
1,339.09
202.02
17.77%
Mister Car Wash Earnings Call Summary
Earnings Call Date: Feb 19, 2025 | % Change Since: 6.58% | Next Earnings Date: Apr 30, 2025
Earnings Call Sentiment Positive
Mister Car Wash demonstrated strong financial performance in 2024 with record revenues and EBITDA growth, driven by a successful subscription model and innovative offerings like the Titanium service. The company is well-positioned for future growth through strategic expansions and disciplined cost management. However, challenges remain with retail sales uncertainty and competitive pressures in the market.Highlights
Record Revenues and EBITDA
Mister Car Wash reported record revenues for 2024 with sales up 7% and adjusted EBITDA growing by 12%, marking a significant achievement in financial performance.
Greenfield Program Success
The company opened 40 new locations in 2024, surpassing the 500-store milestone, demonstrating strong expansion efforts through their greenfield program.
Strong Subscription Model Performance
Subscription business remained resilient with member utilization holding constant, and a 10% increase in Express revenue per member in Q4, highlighting the strength of their predominantly subscription-based model.
Innovative Offerings Drive Growth
The introduction of the Titanium service exceeded expectations, achieving 23% UWC membership penetration and contributing to the company's growth in premium offerings.
Positive Financial Outlook for 2025
The company provided a positive financial outlook for 2025, expecting a 4% to 8% growth in adjusted EBITDA and a 15% to 22% increase in adjusted net income per share.
Lowlights
Retail Sales Uncertainty
Despite improvements, the retail segment remains sensitive to weather and consumer behavior, with an anticipated mid-single-digit decline in 2025 due to ongoing headwinds.
Competitive Pressure
The competitive environment remains challenging with a crowded landscape, and although the influx of new entrants is decelerating, the company remains cautious about market dynamics.
Labor and Cost Pressures
While cost management has been effective, labor rates have increased, and additional marketing investments are expected to create some pressure on margins.
Company Guidance
During the Mister Car Wash Fourth Quarter 2024 Conference Call, the company provided detailed guidance for 2025, reflecting a cautiously optimistic view of the year ahead. They expect net revenue to range from $1.38 billion to $1.64 billion, with comparable store sales growth anticipated to be between 1% and 3%. Adjusted EBITDA is projected to be between $334 million and $346 million, representing a growth of approximately 4% to 8% year-over-year, with a margin of 32.2% to 32.5%. They also predict adjusted net income per diluted share to be between $0.43 and $0.45, which would signify a growth of 15% to 22%. The company plans to open approximately 30 to 35 new stores and expects capital expenditures to range from $275 million to $305 million. Despite potential headwinds from consumer behavior and weather sensitivity, Mister Car Wash remains focused on strategic growth, including a greenfield program and potential M&A opportunities, while also planning to leverage sale-leasebacks to fund expansion.Mister Car Wash Corporate Events
Executive/Board Changes
Mister Car Wash Announces General Counsel Transition Plan
Neutral
Jan 29, 2025
Mister Car Wash, Inc. announced an employment transition for Markus Hartmann, who ceased to serve as General Counsel on January 6, 2025. The Transition and Severance Agreement ensures Hartmann’s employment and transition services until February 6, 2025, with compensation and benefits outlined, including a severance payment starting February 7, 2025, and healthcare coverage options.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
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.