MTY Food Group (MTY) AI Stock Analysis

• Market Cap: $889.64M
• Dividend Yield: 3.26%
• Average Volume (3M): 54.94K
• Price to Earnings (P/E): 23.3
• Beta (1Y): 0.92
• Revenue Growth: 0.55%
• EPS Growth: -59.39%
• Country: CA
• Employees: 7,632
• Sector: Consumer Cyclical
• Sector Strength: 80
• Industry: Restaurants
• EPS (TTM): 1.17
• Shares Outstanding: 22,846,361
• 10 Day Avg. Volume: 40,401
• 30 Day Avg. Volume: 54,938
• PEG Ratio: -0.62
• Price to Book (P/B): 1.43
• Price to Sales (P/S): 0.99
• P/FCF Ratio: 6.45
• Enterprise Value/Market Cap: 2.37
• Enterprise Value/Revenue: 1.81
• Enterprise Value/Gross Profit: 6.05
• Enterprise Value/Ebitda: 11.65
• 1Y Price Target: $47.84
• Price Target Upside: 22.86% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 3

• Rating: 63 Neutral
• Price Target: C$42.00 ▲(7.86% Upside)

MTY Food Group's overall stock score is primarily influenced by its strong financial performance and positive corporate events. However, bearish technical indicators and valuation concerns weigh down the score. The mixed sentiment from the earnings call, with growth in some areas but challenges in others, also impacts the overall assessment.

MTY Food Group Business Overview & Revenue Model

Company Description

MTY Food Group Inc. is a Canadian multinational company that specializes in the franchising and operation of quick-service restaurants (QSR) and casual dining establishments. Founded in 1979, MTY has expanded its portfolio to include a diverse array of brands across various sectors, including Asian cuisine, Italian, and fast-food formats. The company operates and franchises numerous well-known brands, contributing to its presence in both Canadian and international markets.

How the Company Makes Money

MTY Food Group primarily generates revenue through a combination of franchise fees, royalties, and direct sales from its company-operated locations. Franchise fees are charged to franchisees for the rights to use MTY's brand and operational systems, which typically include an initial franchise fee and ongoing royalty payments based on sales. Additionally, MTY earns revenue from the direct operation of its own restaurants, which contributes to its overall sales figures. The company also benefits from economies of scale through purchasing and supply chain efficiencies, allowing it to negotiate favorable terms with suppliers. Strategic partnerships with various food suppliers and service providers further bolster its revenue streams, while the continuous expansion of its brand portfolio through acquisitions helps to diversify income sources and increase market presence.

MTY Food Group Financial Statement Overview

Summary

MTY Food Group exhibits solid financial health with strong cash flows and operational efficiency, despite challenges in revenue growth and thin net margins. The balance sheet shows manageable leverage, but profitability metrics indicate room for improvement.

Income Statement

MTY Food Group demonstrates a strong gross profit margin of 36.7% and a net profit margin of 0.74% for TTM (Trailing-Twelve-Months), indicating operational efficiency but thin profitability. EBIT margin at 26.3% shows robust core earnings capability. However, revenue growth has been modest, with a slight increase in TTM compared to previous annual reports, suggesting limited top-line expansion.

Balance Sheet

The company's debt-to-equity ratio of 1.49 indicates a moderate level of leverage, which is common in the restaurant industry but could pose risks if not managed well. Return on equity is relatively low at 1.05% for TTM, reflecting limited profitability. However, the equity ratio of 31.2% suggests a stable capital structure, providing some financial stability.

Cash Flow

MTY Food Group's cash flow performance is robust with a high operating cash flow to net income ratio of 24.34 for TTM, indicating strong cash generation relative to net earnings. Free cash flow growth has been consistent, reinforcing financial flexibility. However, the free cash flow to net income ratio of 21.48 suggests strong cash conversion, supporting strategic investments and debt servicing.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.17B	1.16B	1.17B	716.52M	551.90M	511.12M
Gross Profit	348.42M	419.18M	340.98M	255.40M	300.62M	276.61M
EBITDA	180.95M	165.34M	263.02M	165.60M	169.80M	14.65M
Net Income	38.62M	24.17M	104.08M	74.82M	85.64M	-36.90M
Balance Sheet
Total Assets	2.51B	2.59B	2.68B	2.33B	1.90B	2.01B
Cash, Cash Equivalents and Short-Term Investments	47.20M	50.41M	58.90M	59.48M	61.23M	44.30M
Total Debt	1.17B	1.22B	1.30B	1.08B	834.28M	1.02B
Total Liabilities	1.72B	1.78B	1.87B	1.60B	1.26B	1.43B
Stockholders Equity	794.20M	801.84M	811.41M	723.41M	647.64M	581.75M
Cash Flow
Free Cash Flow	186.47M	177.08M	152.42M	130.14M	132.54M	128.03M
Operating Cash Flow	209.03M	204.81M	184.59M	142.80M	139.30M	133.65M
Investing Cash Flow	-20.65M	-23.54M	-319.66M	-258.42M	7.20M	-12.11M
Financing Cash Flow	-188.72M	-186.78M	135.94M	105.30M	-129.58M	-126.37M

MTY Food Group Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 38.94
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:MTY, the sentiment is Negative. The current price of 38.94 is above the 20-day moving average (MA) of 38.71, below the 50-day MA of 40.27, and below the 200-day MA of 43.54, indicating a neutral trend. The MACD of -0.33 indicates Negative momentum. The RSI at 46.83 is Neutral, neither overbought nor oversold. The STOCH value of 59.59 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:MTY.

MTY Food Group Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MTY	63 Neutral	$889.64M	23.35	4.59%	3.26%	0.55%	-59.39%
Sector *	61 Neutral	$17.75B	12.56	-5.49%	3.02%	1.43%	-14.12%
PZRIF	―	$394.02M	17.62	10.14%	5.64%	―	―
ODD	45 Neutral	C$19.69M	―		―	-2.40%	9.13%
AEG	―	C$29.00M	―	6.84%	―	―	―
JIVA	―	C$69.31K	―		―	―	―
FOOD	46 Neutral	C$19.18M	―	11.42%	―	-16.73%	-78.61%

MTY Food Group Corporate Events

MTY Food Group Reports Strong Q2 2025 Earnings Amid Market Challenges

MTY Food Group reported a significant increase in net income for the second quarter of fiscal 2025, with net income attributable to owners rising to $57.3 million compared to $27.3 million in the previous year. Despite a slight decrease in cash flows from operating activities and a decrease in normalized adjusted EBITDA, the company saw a slight increase in system sales. The company is addressing challenges in its Corporate segment by exploring strategic options to enhance long-term profitability, while its Franchise and Retail segments performed better. The U.S. market faced macroeconomic pressures, but Canada showed strong performance, particularly in casual dining, highlighting the resilience of MTY’s brands.

The most recent analyst rating on (TSE:MTY) stock is a Hold with a C$51.00 price target. To see the full list of analyst forecasts on MTY Food Group stock, see the TSE:MTY Stock Forecast page.

MTY Food Group to Discuss Q2 Results in Upcoming Conference Call

MTY Food Group Inc. has announced it will hold a conference call to discuss its second quarter results on July 11, 2025. The call is open to analysts, investors, and interested parties, with options to join via phone or webcast. This announcement allows stakeholders to gain insights into the company’s financial performance and strategic direction for the upcoming period.

The most recent analyst rating on (TSE:MTY) stock is a Hold with a C$55.00 price target. To see the full list of analyst forecasts on MTY Food Group stock, see the TSE:MTY Stock Forecast page.

MTY Food Group Renews Share Buyback Program

MTY Food Group Inc. has announced the renewal of its normal course issuer bid, allowing the company to repurchase up to 1,142,068 common shares, which is about 5% of its outstanding shares, from July 3, 2025, to July 2, 2026. This strategic move is seen as a beneficial capital allocation strategy by MTY’s Board of Directors and senior management, potentially impacting the company’s market positioning and shareholder value positively.

The most recent analyst rating on (TSE:MTY) stock is a Hold with a C$55.00 price target. To see the full list of analyst forecasts on MTY Food Group stock, see the TSE:MTY Stock Forecast page.

MTY Food Group Renews Share Buyback Program

MTY Food Group Inc. announced the renewal of its normal course issuer bid, allowing the company to repurchase up to 1,196,513 common shares, approximately 5% of its outstanding shares, between July 3, 2024, and July 2, 2025. This strategic move is seen as a beneficial capital allocation strategy by MTY’s Board of Directors and senior management, reflecting their confidence in the company’s market position and future prospects.

The most recent analyst rating on (TSE:MTY) stock is a Buy with a C$54.00 price target. To see the full list of analyst forecasts on MTY Food Group stock, see the TSE:MTY Stock Forecast page.