TH International (THCH) AI Stock Analysis

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TH International

(NASDAQ:THCH)

Rating:44Neutral

Price Target:

$3.00

▲(0.67%Upside)

TH International's overall stock score is primarily influenced by its poor financial performance, which raises concerns about long-term viability. The earnings call provided some positive insights, reflecting operational improvements and strategic growth efforts. Technical indicators suggest a mixed outlook, with short-term momentum but longer-term challenges. Valuation metrics remain unattractive due to negative profitability.

TH International (THCH) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$99.08M

Dividend YieldN/A

Average Volume (3M)13.11K

Price to Earnings (P/E)―

Beta (1Y)0.34

Revenue Growth-14.11%

EPS Growth54.77%

CountryUS

Employees2,367

SectorConsumer Cyclical

Sector Strength61

IndustryRestaurants

Share Statistics

EPS (TTM)-0.25

Shares Outstanding33,193,190

10 Day Avg. Volume11,873

30 Day Avg. Volume13,108

Financial Highlights & Ratios

PEG Ratio0.20

Price to Book (P/B)-0.76

Price to Sales (P/S)0.00

P/FCF Ratio-17.46

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price TargetN/A

Price Target UpsideN/A

Rating ConsensusN/A

Number of Analyst Covering0

TH International Business Overview & Revenue Model

Company DescriptionTH International Limited operates Tim Hortons coffee shops in mainland China, Hong Kong, and Macau. As of September 28, 2022, it had approximately 460 coffee shops across the People's Republic of China. The company was incorporated in 2018 and is based in Shanghai, the People's Republic of China. TH International Limited is a subsidiary of Tim Hortons Inc.

How the Company Makes MoneyTH International makes money primarily through the sale of food and beverages at its Tim Hortons locations in China. The company generates revenue by offering a wide range of products, including coffee, donuts, pastries, sandwiches, and other fast-casual dining options. Additionally, TH International benefits from strategic partnerships and franchise agreements, which allow for expanded reach and consistent brand presence across the market. The company's earnings are influenced by factors such as store traffic, customer preferences, and the overall economic environment in the regions where it operates.

TH International Earnings Call Summary

Earnings Call Date:Jun 24, 2025

(Q4-2024)

% Change Since: 7.97%|

Next Earnings Date:Aug 28, 2025

Earnings Call Sentiment Neutral

The earnings call highlighted significant milestones in store expansion, profitability improvements, and loyalty program growth. However, there were notable declines in total revenue and same-store sales growth, which contributed to a decrease in the company's cash position.

Q4-2024 Updates

Positive Updates

Store Expansion Milestone

Reached the grand opening of the 1,000th store in Shanghai, marking a significant moment in national expansion.

Improved Profitability

Company-owned and operated store contribution margin improved by 5.3 percentage points and adjusted corporate EBITDA margin improved by 9.9 percentage points year-over-year.

Loyalty Program Growth

Registered loyalty club members exceeded 24 million, reflecting a 29.7% year-over-year growth.

Successful Franchise Model

Received over 6,200 subfranchisee applications and successfully opened around 100 stores by the end of 2024.

Product Innovation Impact

Launched 92 new products in 2024, contributing approximately 25% of top line sales.

Negative Updates

Decline in Total Revenues

Total revenues and system sales dropped by 10.8% and 6.2% year-over-year, respectively.

Same-Store Sales Decrease

Same-store sales growth for system-wide stores decreased by 15.8%.

Cash Position Decline

Total cash and cash equivalents decreased from RMB 219.5 million to RMB 184.2 million by the end of 2024.

Company Guidance

In the recent Tims China Fourth Quarter 2024 Earnings Conference Call, the company provided a comprehensive overview of its strategic and financial performance. The company highlighted significant milestones, including the grand opening of its 1,000th store and the expansion into 82 cities. Tims China reported enhancements in operational efficiencies, with a 5.3 percentage point improvement in company-owned and operated store contribution margin and a 9.9 percentage point increase in adjusted corporate EBITDA margin year-over-year. Product innovation was emphasized, with 92 new products launched in 2024, contributing approximately 25% to top-line sales. The company's loyalty program saw membership grow by 29.7% to over 24 million registered members. Despite a 10.8% drop in total revenues, Tims China maintained focus on improving financial performance and driving efficiencies, aiming for corporate EBITDA breakeven in 2025. The sub-franchisee business showed robust growth, with revenues increasing by 105.3% as the number of franchised stores rose to 446 by year-end. The company also highlighted the successful introduction of new healthy food options and all-day solutions to boost sales across different meal periods.

TH International Financial Statement Overview

Summary

TH International faces significant financial hurdles across its income statement, balance sheet, and cash flow statement. Despite revenue growth, consistent net losses, negative equity, and negative cash flows point to severe operational inefficiencies and insolvency risks.

Income Statement

Very Negative

TH International's income statement reveals significant challenges, with consistent net losses over recent years, including a net income of -$412 million in 2024. The company has not achieved profitability, as indicated by negative EBIT and EBITDA margins. Although revenue has grown from $212 million in 2020 to $1.39 billion in 2024, the net losses suggest inefficiencies and high operational costs, impacting overall financial health.

Balance Sheet

Very Negative

The balance sheet shows concerning financial leverage, with a debt-to-equity ratio that is undefinable due to negative stockholders' equity of -$840 million in 2024. Total liabilities exceed total assets, indicating insolvency risk. Equity has declined significantly over the years, highlighting financial instability and raising concerns about the company's long-term sustainability.

Cash Flow

Negative

The cash flow analysis indicates negative operating cash flow, with -$39 million in 2024, and persistent negative free cash flow, impacting liquidity. The company struggles to generate positive cash flow from operations, suggesting challenges in covering expenses and investing in growth opportunities. This cash flow deficit highlights the need for strategic adjustments to improve financial operations.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.39B	1.58B	1.01B	643.37M	212.08M
Gross Profit	213.56M	417.16M	33.05M	13.81M	6.62M
EBITDA	-266.19M	-686.50M	-431.72M	-302.90M	-115.22M
Net Income	-412.08M	-876.25M	-910.17M	-378.05M	-142.00M
Balance Sheet
Total Assets	1.56B	2.22B	2.64B	1.28B	580.36M
Cash, Cash Equivalents and Short-Term Investments	161.37M	227.00M	611.45M	390.84M	174.87M
Total Debt	1.88B	1.87B	1.77B	522.42M	0.00
Total Liabilities	2.40B	2.64B	2.53B	945.80M	147.31M
Stockholders Equity	-840.89M	-427.21M	108.85M	335.54M	428.29M
Cash Flow
Free Cash Flow	-142.51M	-488.53M	-621.86M	-580.28M	-290.52M
Operating Cash Flow	-39.67M	-196.13M	-286.93M	-244.97M	-145.77M
Investing Cash Flow	-8.04M	60.00M	-705.17M	-335.28M	-144.75M
Financing Cash Flow	26.00M	80.83M	827.16M	798.00M	221.12M

TH International Technical Analysis

Technical Analysis Sentiment

Positive

Last Price2.98

Price Trends

50DMA

2.77

Positive

100DMA

2.85

Positive

200DMA

3.22

Negative

Market Momentum

MACD

0.05

Negative

RSI

59.77

Neutral

STOCH

90.37

Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For THCH, the sentiment is Positive. The current price of 2.98 is above the 20-day moving average (MA) of 2.80, above the 50-day MA of 2.77, and below the 200-day MA of 3.22, indicating a neutral trend. The MACD of 0.05 indicates Negative momentum. The RSI at 59.77 is Neutral, neither overbought nor oversold. The STOCH value of 90.37 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive 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

Overall Rating

UnderperformOutperform

Sector (62)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	62 Neutral	$16.90B	11.24	-7.48%	2.95%	1.60%	-23.76%
RRGB	58 Neutral	$118.48M	―	92.02%	―	-1.68%	-140.83%
BDL	58 Neutral	$53.90M	13.31	6.48%	1.90%	9.38%	14.76%
STKS	49 Neutral	$158.53M	―	-9.31%	―	138.50%	-60576.19%
THCH	44 Neutral	$99.08M	―		―	-14.11%	54.77%
NDLS	44 Neutral	$36.44M	―	-978.37%	―	-0.61%	-200.32%
FAT	44 Neutral	$43.73M	―	38.50%	419.35%	10.63%	-93.67%

* Consumer Cyclical Sector Average

Performance Comparison

THCH

TH International

2.98

-0.16

-5.10%

BDL

Flanigan's Enterprises

29.21

2.95

11.23%

RRGB

Red Robin Gourmet

6.37

0.27

4.43%

NDLS

Noodles & Co

0.79

-0.71

-47.33%

STKS

The ONE Group Hospitality

4.72

0.66

16.26%

FAT

Fat Brands

2.45

-0.11

-4.30%

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.Date of analysis: Jun 28, 2025