Rave Restaurant Group (RAVE) AI Stock Analysis

• Market Cap: $33.11M
• Dividend Yield: N/A
• Average Volume (3M): 48.85K
• Price to Earnings (P/E): 12.5
• Beta (1Y): 0.91
• Revenue Growth: 0.35%
• EPS Growth: 9.25%
• Country: US
• Employees: 21
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Restaurants
• EPS (TTM): 0.04
• Shares Outstanding: 14,211,566
• 10 Day Avg. Volume: 51,548
• 30 Day Avg. Volume: 48,853
• PEG Ratio: 1.25
• Price to Book (P/B): 2.82
• Price to Sales (P/S): 3.31
• P/FCF Ratio: 11.94
• Enterprise Value/Market Cap: 0.85
• Enterprise Value/Revenue: 2.30
• Enterprise Value/Gross Profit: 3.22
• Enterprise Value/Ebitda: 6.83
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: Hold
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 76 Outperform
• Price Target: $3.50 ▲(22.38% Upside)

Rave Restaurant Group's strong financial performance and positive technical indicators are the primary drivers of its stock score. The company's effective debt management and solid profit margins contribute significantly, while the technical analysis suggests bullish momentum. The valuation is reasonable, though the lack of a dividend yield is a minor drawback.

Positive Factors

Strong Profit Margins

High and improving profit margins indicate effective cost management and pricing strategies, enhancing long-term profitability and competitiveness.

Debt Management

Significant reduction in debt enhances financial stability and flexibility, allowing for better resource allocation and investment in growth opportunities.

Cash Generation

Strong cash generation relative to net income supports ongoing operations and provides a buffer for future investments and potential downturns.

Negative Factors

Inconsistent Revenue Growth

Inconsistent revenue growth can hinder long-term strategic planning and investment, potentially affecting market position and competitive edge.

Negative Free Cash Flow Growth

Negative free cash flow growth may limit the company's ability to fund new projects or expansions, impacting long-term growth prospects.

Small Workforce

A small workforce may limit the company's ability to scale operations and manage growth effectively, potentially impacting long-term expansion plans.

Rave Restaurant Group Business Overview & Revenue Model

Company Description

Rave Restaurant Group, Inc., together with its subsidiaries, operates and franchises pizza buffet, delivery/carry-out (delco), and express restaurants under the Pizza Inn trademark in the United States and internationally. It operates through three segments: Pizza Inn Franchising, Pie Five Franchising, and Company-Owned Restaurants. The company's buffet restaurants are located in free standing buildings or strip centers in retail developments that offer dine-in, carryout, and catering services, as well as delivery services. Its delco restaurants provide delivery and carryout services and are located in shopping centers or other in-line retail developments. The company's Express restaurants serve customers through various non-traditional points of sale and are located in convenience stores, food courts, college campuses, airport terminals, travel plazas, athletic facilities, or other commercial facilities. In addition, it operates and franchises fast casual restaurants under the Pie Five Pizza Company or Pie Five trademarks. As of June 27, 2021, the company had 33 franchised Pie Five Units, 156 franchised Pizza Inn restaurants, and 11 licensed Pizza Inn Express, or PIE, kiosks. The company was formerly known as Pizza Inn Holdings, Inc. and changed its name to Rave Restaurant Group, Inc. in January 2015. Rave Restaurant Group, Inc. was founded in 1958 and is based in The Colony, Texas.

How the Company Makes Money

Rave Restaurant Group generates revenue through multiple streams, primarily from the sale of food and beverages in its restaurants. The company operates both company-owned and franchised locations, with franchise fees and royalties contributing significantly to its earnings. Additionally, RAVE engages in promotional partnerships and collaborations that enhance brand visibility and attract customers. The company also benefits from economies of scale in procurement and supply chain management, allowing it to maintain competitive pricing and improve margins. Overall, the combination of direct sales from its restaurants and fees from franchisees constitutes the core of RAVE's revenue model.

Rave Restaurant Group Financial Statement Overview

Summary

Rave Restaurant Group exhibits strong profitability and improved financial stability. The company has effectively managed its debt levels and maintained solid profit margins. While revenue growth has been inconsistent, the company’s operational efficiency and cash flow generation remain strong.

Income Statement

Rave Restaurant Group demonstrates strong profitability with a consistent gross profit margin above 65% and a net profit margin that has improved significantly over the years, reaching 22.44% in the latest period. However, revenue growth has been inconsistent, with a slight decline in the most recent year. The EBIT and EBITDA margins are robust, indicating efficient operations.

Balance Sheet

The company has significantly improved its financial stability, reducing its debt-to-equity ratio from a high of 12.54 to a more manageable 0.04. The return on equity remains strong at 19.09%, reflecting effective use of equity to generate profits. The equity ratio indicates a solid capital structure with a high proportion of equity financing.

Cash Flow

Rave Restaurant Group shows a healthy operating cash flow to net income ratio of 1.95, indicating strong cash generation relative to net income. However, free cash flow growth has been negative recently, which could be a concern if it persists. The free cash flow to net income ratio is nearly 1, suggesting efficient conversion of profits into cash.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	12.20M	12.04M	12.15M	11.89M	10.69M	8.59M
Gross Profit	8.72M	8.64M	8.49M	7.93M	7.41M	5.93M
EBITDA	4.11M	3.80M	3.57M	2.81M	3.03M	2.32M
Net Income	2.82M	2.70M	2.47M	1.61M	8.02M	1.52M
Balance Sheet
Total Assets	17.00M	16.56M	15.82M	14.24M	18.52M	13.35M
Cash, Cash Equivalents and Short-Term Investments	10.56M	9.88M	7.83M	5.33M	7.72M	8.33M
Total Debt	485.00K	576.00K	957.00K	1.42M	1.94M	4.20M
Total Liabilities	2.17M	2.40M	3.12M	3.85M	5.10M	7.61M
Stockholders Equity	14.84M	14.15M	12.70M	10.39M	13.41M	5.73M
Cash Flow
Free Cash Flow	3.40M	3.34M	2.66M	2.40M	1.22M	1.20M
Operating Cash Flow	3.48M	3.40M	2.74M	2.63M	1.38M	1.49M
Investing Cash Flow	-2.08M	-2.04M	-4.87M	-15.00K	338.00K	-238.00K
Financing Cash Flow	-1.39M	-1.39M	-311.00K	-5.01M	-2.33M	3.88M

Rave Restaurant Group Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 2.86
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RAVE, the sentiment is Negative. The current price of 2.86 is below the 20-day moving average (MA) of 2.90, below the 50-day MA of 2.94, and above the 200-day MA of 2.81, indicating a neutral trend. The MACD of 0.05 indicates Negative momentum. The RSI at 47.07 is Neutral, neither overbought nor oversold. The STOCH value of 45.53 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for RAVE.

Rave Restaurant Group Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
RAVE	76 Outperform	$33.11M	12.52	20.05%	―	0.35%	9.25%
BDL	71 Outperform	$57.24M	13.25	6.88%	1.79%	8.83%	41.90%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
GTIM	51 Neutral	$14.14M	11.44	3.85%	―	1.84%	12.10%
ARKR	47 Neutral	$25.60M	-1.83	-33.50%	―	-6.89%	-42.75%
NDLS	46 Neutral	$33.68M	―	―	―	-0.35%	-37.02%
FAT	41 Neutral	$32.02M	-0.14	―	517.12%	-5.26%	-44.78%