Want to see THCH full AI Analyst Report?
Top Page
TH International
(NASDAQ:THCH)
Select Model
Select Model
Rating:47Neutral
Price Target:
$2.00
▲(14.94% Upside)
Action:Reiterated
Date:07/11/26
The score is driven primarily by weak financial performance—deep losses, ongoing cash burn, and a highly stressed balance sheet with negative equity and heavy debt. The latest earnings call adds some offsetting positives (expected same-store sales recovery, improving store-level economics, and strong franchising traction), but near-term operating deterioration and liquidity risk remain. Technicals are neutral-to-soft and valuation lacks support due to unprofitability and no dividend.
Positive Factors
Franchise rollout scalability
Rapid franchising creates a capital-light expansion channel and accelerates network scale. High-teens contribution margins and ~2-year payback for franchise/special-channel stores reduce company cash needs, improve cash conversion and make growth less dependent on corporate capex over the medium term.
Negative Factors
Highly stressed balance sheet
Negative equity and heavy secured debt materially constrain financial flexibility, raise refinancing and covenant risk, and increase reliance on related-party financing. This structural leverage burden limits the company's ability to absorb further operating volatility over the coming quarters.
Read all positive and negative factors
Positive Factors
Negative Factors
Franchise rollout scalability
Rapid franchising creates a capital-light expansion channel and accelerates network scale. High-teens contribution margins and ~2-year payback for franchise/special-channel stores reduce company cash needs, improve cash conversion and make growth less dependent on corporate capex over the medium term.
Read all positive factors
TH International (THCH) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$54.14M
Dividend YieldN/A
Average Volume (3M)7.98K
Price to Earnings (P/E)―
Beta (1Y)0.54
Revenue Growth-5.08%
EPS Growth-26.11%
CountryUS
Employees1,544
SectorConsumer Cyclical
Sector Strength84
IndustryRestaurants
Share Statistics
EPS (TTM)-14.85
Shares Outstanding32,036,530
10 Day Avg. Volume7,038
30 Day Avg. Volume7,982
Financial Highlights & Ratios
PEG Ratio-0.55
Price to Book (P/B)-0.46
Price to Sales (P/S)0.44
P/FCF Ratio-7.23
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda>-0.01
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)-4.72
Revenue Forecast (FY)$1.47B
TH International Business Overview & Revenue Model
Company Description
TH International Limited (THCH) is a quick-service restaurant company that develops, operates, and franchises Tim Hortons restaurants in China. The company operates in the foodservice/restaurant sector and focuses on selling coffee and other bever...
How the Company Makes Money
TH International primarily generates revenue through its Tim Hortons-branded restaurant network in China via a mix of company-operated and franchised locations. Key revenue streams typically include: (1) Retail sales at company-operated restaurant...
TH International Earnings Call Summary
Earnings Call Date:Jun 09, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Sep 02, 2026
Earnings Call Sentiment Neutral
The call presents a mixed picture: meaningful short-term top-line and margin pressures (double-digit revenue decline, negative same-store sales and a wider negative adjusted EBITDA margin) are balanced by strong progress on strategic initiatives—rapid loyalty member growth (+42.9% YoY), franchise momentum (over 10,500 applications, ~260 franchise stores opened), improved unit economics for recent vintage stores (low- to mid-teens contribution margins), gross margin improvement (food & packaging down 2.0pp) and committed financing support (up to USD 55M). Management expects same-store sales recovery and resumed net openings in Q2 2026, indicating confidence in a turnaround, but near-term financial headwinds and tighter liquidity remain notable risks.Positive Updates
Strong Loyalty Membership Growth
Registered loyalty club members exceeded 35.9 million as of March 31, 2026, representing a 42.9% year-over-year increase. Transacting members under age 30 account for nearly 50% of the membership base. Partnership with DiDi added ~4 million new members during the quarter (nearly threefold YoY growth).
Negative Updates
Significant Revenue and System Sales Decline
Total revenues dropped 14.6% YoY in Q1 2026 and system sales fell 14.2% YoY, driven by seasonal slowdown, pruning of underperforming company-owned stores and weaker same-store sales.
Read all updates
Q1-2026 Updates
Positive
Negative
Strong Loyalty Membership Growth
Registered loyalty club members exceeded 35.9 million as of March 31, 2026, representing a 42.9% year-over-year increase. Transacting members under age 30 account for nearly 50% of the membership base. Partnership with DiDi added ~4 million new members during the quarter (nearly threefold YoY growth).
Read all positive updates
Company Guidance
Management guided that the company expects a recovery in same-store sales beginning in Q2 2026 and improving through the rest of the year after a Q1 comparable transactions decline of 8.3% and average comparable ticket decline of 4.8% that drove a Q1 same‑store sales decline of 13.2%; they plan to complete pruning underperforming stores this year and resume net new openings from Q2. They reiterated unit‑economics targets: 2024 vintage stores delivered nearly 15% store contribution margin in 2025 and low‑teens in Q1 2026, 2025 vintages are expected to reach similar levels, special‑channel and franchise stores generated high‑teens contribution margins in 2025 with an approximately 2‑year payback, and company payback for recent vintages is targeted at 2–3 years; Tier‑1 stores delivered >10% contribution and cities with 10+ stores >7% in 2025. Operational and financial priorities include driving sustainable revenue growth, improving supply‑chain gross margin (food & packaging down 2.0 ppt to 28.4% of revenues), expanding profitable sub‑franchising (individual franchise: >10,500 applications, >440 signed, ~260 opened by Mar 31, 2026), growing membership (>35.9M registered, +42.9% YoY; ~4M added via DiDi in Q1, ~3x YoY; transacting members <30 ≈50%; >35,000 members/store average), increasing digital penetration (digital orders 87.5%), managing costs (Q1 marketing RMB9.8M, -43.7% YoY) and moving corporate adjusted EBITDA from -11.8% toward breakeven, supported by RMB111.4M cash and a proposed up to USD55M convertible note financing.TH International Financial Statement Overview
Summary
Income Statement
12
Very Negative
Balance Sheet
8
Very Negative
Cash Flow
14
Very Negative
| Breakdown | Mar 2026 | Mar 2025 | Mar 2024 | Mar 2023 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 1.28B | 1.39B | 1.56B | 1.01B | 643.37M |
| Gross Profit | 77.62M | 213.56M | 156.34M | 33.05M | 13.81M |
| EBITDA | -302.25M | -266.19M | -656.06M | -596.54M | -306.75M |
| Net Income | -422.65M | -412.08M | -876.25M | -742.65M | -381.72M |
Balance Sheet | |||||
| Total Assets | 1.18B | 1.56B | 2.22B | 2.64B | 1.28B |
| Cash, Cash Equivalents and Short-Term Investments | 134.67M | 161.37M | 225.72M | 614.92M | 395.00M |
| Total Debt | 1.97B | 1.88B | 1.81B | 1.77B | 522.42M |
| Total Liabilities | 2.41B | 2.40B | 2.64B | 2.53B | 945.80M |
| Stockholders Equity | -1.24B | -840.89M | -427.21M | 108.85M | 335.54M |
Cash Flow | |||||
| Free Cash Flow | -78.33M | -142.51M | -488.53M | -621.86M | -580.28M |
| Operating Cash Flow | -12.71M | -39.67M | -196.13M | -286.93M | -244.97M |
| Investing Cash Flow | -62.83M | -8.04M | 60.00M | -705.17M | -335.28M |
| Financing Cash Flow | 21.70M | 26.00M | 80.83M | 827.16M | 798.00M |
TH International Technical Analysis
Negative
1.74
Price Trends
1.77
Negative
1.92
Negative
2.11
Negative
Market Momentum
-0.03
Positive
43.32
Neutral
23.60
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For THCH, the sentiment is Negative. The current price of 1.74 is below the 20-day moving average (MA) of 1.76, below the 50-day MA of 1.77, and below the 200-day MA of 2.11, indicating a bearish trend. The MACD of -0.03 indicates Positive momentum. The RSI at 43.32 is Neutral, neither overbought nor oversold. The STOCH value of 23.60 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for THCH.
TH International Risk Analysis
TH International disclosed 88 risk factors in its most recent earnings report. TH International 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
TH International Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
77 Outperform | $44.77M | 15.28 | 19.21% | ― | 3.20% | 9.92% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
52 Neutral | $145.04M | -5.26 | 27.56% | ― | -4.49% | 64.71% | |
48 Neutral | $56.18M | -0.44 | -65.14% | ― | 0.99% | -217.64% | |
47 Neutral | $54.14M | -0.77 | 42.17% | ― | -5.08% | -26.11% | |
45 Neutral | $66.92M | -2.74 | -27.46% | ― | -2.72% | -1962.01% |
* Consumer Cyclical Sector Average
THCH
TH International
1.69
-0.96
-36.23%
RAVE
Rave Restaurant Group
3.15
0.29
10.14%
RRGB
Red Robin Gourmet
7.84
2.20
39.01%
STKS
The ONE Group Hospitality
1.78
-1.25
-41.25%
GENK
GEN Restaurant Group, Inc. Class A
2.03
-2.02
-49.88%
TH International Corporate Events
Tims China Raises US$15.8 Million in First Tranche of 2029 Convertible Notes
Jul 7, 2026
On July 7, 2026, Tims China closed the issuance of a first tranche of senior secured convertible notes due 2029 to Tim Hortons Restaurants International GmbH, with an aggregate principal of about US$15.6 million and total proceeds of US$15.8 milli...
Tims China Q1 2026 Results Hit by Store Closures as Franchise, Loyalty Base Grow
Jun 10, 2026
TH International Limited, which operates Tim Hortons coffee shops in China under the Tims China brand, posted weaker results for the first quarter of 2026 as it continued to prune underperforming outlets. The group is increasingly relying on its e...
Tims China Names New CEO and Secures Up to US$55 Million in Additional Convertible Financing
Jun 9, 2026
On June 9, 2026, Tims China announced a leadership reshuffle effective June 15, 2026, with long-time CEO Yongchen Lu stepping down to become non‑executive chairman and former chairman Peter Yu remaining on the board as a director. Industry v...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
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.