MTY Food Group (TSE:MTY)
TSX:MTY
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MTY Food Group
(TSX:MTY)
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Rating:69Neutral
Price Target:
C$43.00
▲(8.89% Upside)
Action:Reiterated
Date:04/12/26
The score is driven primarily by improved profitability and solid cash generation, plus very attractive valuation (low P/E and a ~3.5% yield). These strengths are tempered by leverage and a soft top-line trend, while technicals point to weaker near-term momentum; the latest earnings call adds a balanced view with strong pipeline/digital initiatives but near-term same-store sales and margin/cash-flow pressures.
Positive Factors
Profitability Rebound
Margins have recovered materially and remain well above prior-year levels, reflecting improved unit economics and operating leverage in an asset-light franchising model. Sustained mid-to-high-teens operating margins support reinvestment, franchisee economics and resilience through cycles.
Negative Factors
Elevated Leverage
Absolute debt levels remain meaningful and historical leverage was higher; despite improvement, elevated leverage increases financial risk and limits flexibility for large buybacks or aggressive M&A. Interest or refinancing stress could pressure cash available for growth.
Read all positive and negative factors
Positive Factors
Negative Factors
Profitability Rebound
Margins have recovered materially and remain well above prior-year levels, reflecting improved unit economics and operating leverage in an asset-light franchising model. Sustained mid-to-high-teens operating margins support reinvestment, franchisee economics and resilience through cycles.
Read all positive factors
MTY Food Group (MTY) vs. iShares MSCI Canada ETF (EWC)
Market Cap
C$863.63M
Dividend Yield3.51%
Average Volume (3M)77.28K
Price to Earnings (P/E)6.4
Beta (1Y)0.89
Revenue Growth0.63%
EPS Growth2106.19%
CountryCA
Employees7,632
SectorConsumer Cyclical
Sector Strength84
IndustryRestaurants
Share Statistics
EPS (TTM)6.73
Shares Outstanding22,841,360
10 Day Avg. Volume39,967
30 Day Avg. Volume77,280
Financial Highlights & Ratios
PEG Ratio0.02
Price to Book (P/B)1.01
Price to Sales (P/S)0.73
P/FCF Ratio5.11
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
C$45.40Price Target Upside14.97% Upside
Rating ConsensusHold
Number of Analyst Covering5
EPS Forecast (FY)4.6
Revenue Forecast (FY)C$1.13B
MTY Food Group Business Overview & Revenue Model
Company Description
MTY Food Group Inc. franchises and operates quick-service, fast-casual, and casual dining restaurants in Canada, the United States, and internationally. The company also sells retail products under a multitude of banners. As of November 30, 2021, ...
How the Company Makes Money
MTY primarily makes money through a franchise-driven model. A significant portion of revenue is generated from (1) royalties and franchise fees paid by franchisees, typically calculated as a percentage of franchisee restaurant sales and/or set con...
MTY Food Group Earnings Call Summary
Earnings Call Date:Apr 10, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Jul 09, 2026
Earnings Call Sentiment Neutral
The call mixed solid operational and financial stabilizers against meaningful near-term challenges. Positive elements include stable adjusted EBITDA, a slight improvement in franchise margins, growing digital sales (23% of sales) and a very strong new-store pipeline of ~200 locations under construction. These are balanced by weaker same-store sales (-2.5%), a Q1 net decline in locations (52 opens vs 90 closures), franchise revenue pressure, lower reported operating and free cash flow driven by working capital and tax timing, and continued underperformance at Papa Murphy's. Management highlighted ongoing investments in digital, site-selection tools and asset-light growth while noting one-time and timing items (a $5.5M employee retention credit and transition to a 52-week reporting basis) influenced results. Given the comparable weight of positive initiatives and near-term operational headwinds, the tone of the call is cautious but constructive.Positive Updates
Stable Adjusted EBITDA
Normalized adjusted EBITDA of $60.1 million for Q1 2026, essentially in line with the same period last year.
Negative Updates
Same-Store Sales Decline
Overall same-store sales decreased 2.5% in Q1 2026. Canada same-store sales down 0.8% (impacted by last year's nonrecurring sales tax holiday), while U.S. locations were up 3.6%.
Read all updates
Q1-2026 Updates
Positive
Negative
Stable Adjusted EBITDA
Normalized adjusted EBITDA of $60.1 million for Q1 2026, essentially in line with the same period last year.
Read all positive updates
Company Guidance
Management said it expects 2026 to deliver net location growth (after Q1 opened 52 and closed 90 locations, including eight TCBY stores, and with just under 200 locations currently under construction), and highlighted a robust pipeline with a growing share from existing franchisees; they expect franchisee EBITDA growth to outpace same‑store sales and aim to drive corporate‑store margins to consistent high single‑digit levels (corporate margins were 7% this quarter excluding a $5.5M ERC, versus 10% last year). Other forward-looking metrics include an expectation that working capital will be roughly flat year‑over‑year, no further employee retention credits are anticipated, continued investment in digital (digital = 23% of sales; digital sales +3% ex‑FX; Canada +13%, U.S. flat), and the financial flexibility to pursue M&A or share buybacks given net debt of ~$549M and leverage of ~1.9x debt/EBITDA; Q1 reported normalized adjusted EBITDA was $60.1M, franchise normalized adjusted EBITDA $43.2M, franchise revenue $90.7M, corporate revenue $109.7M, food processing revenue $40.8M, and free cash flow net of lease repayments was $29.0M.MTY Food Group Financial Statement Overview
Summary
Income Statement
74
Positive
Balance Sheet
60
Neutral
Cash Flow
66
Positive
| Breakdown | TTM | Nov 2025 | Nov 2024 | Nov 2023 | Nov 2022 | Nov 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 1.17B | 1.19B | 1.16B | 1.17B | 716.52M | 551.90M |
| Gross Profit | 327.58M | 355.67M | 419.18M | 340.98M | 255.40M | 300.62M |
| EBITDA | 313.83M | 289.69M | 165.34M | 263.02M | 165.60M | 169.80M |
| Net Income | 154.18M | 118.99M | 24.17M | 104.08M | 74.82M | 85.64M |
Balance Sheet | ||||||
| Total Assets | 2.46B | 2.51B | 2.59B | 2.68B | 2.33B | 1.90B |
| Cash, Cash Equivalents and Short-Term Investments | 55.96M | 51.99M | 50.41M | 58.90M | 59.48M | 61.23M |
| Total Debt | 1.09B | 1.52B | 1.22B | 1.30B | 1.08B | 834.28M |
| Total Liabilities | 1.60B | 1.65B | 1.78B | 1.87B | 1.60B | 1.26B |
| Stockholders Equity | 854.02M | 856.42M | 801.84M | 811.41M | 723.41M | 647.64M |
Cash Flow | ||||||
| Free Cash Flow | 151.84M | 169.47M | 177.08M | 152.42M | 130.14M | 132.54M |
| Operating Cash Flow | 165.08M | 182.98M | 204.81M | 184.59M | 142.80M | 139.30M |
| Investing Cash Flow | -6.36M | -7.82M | -23.54M | -319.66M | -258.42M | 7.20M |
| Financing Cash Flow | -168.42M | -173.67M | -186.78M | 135.94M | 105.30M | -129.58M |
MTY Food Group Technical Analysis
Negative
39.49
Price Trends
38.93
Negative
39.72
Negative
37.98
Negative
Market Momentum
-0.43
Positive
34.03
Neutral
5.83
Positive
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 39.49 is above the 20-day moving average (MA) of 39.23, above the 50-day MA of 38.93, and above the 200-day MA of 37.98, indicating a bearish trend. The MACD of -0.43 indicates Positive momentum. The RSI at 34.03 is Neutral, neither overbought nor oversold. The STOCH value of 5.83 is Positive, 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
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
69 Neutral | C$863.63M | 6.40 | 18.59% | 3.51% | 0.63% | 2106.19% | |
64 Neutral | C$429.66M | 17.18 | 10.21% | 5.98% | 1.17% | -1.36% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
| ― | C$47.91B | 18.97 | 27.14% | 3.58% | 8.57% | -4.22% | |
55 Neutral | C$864.97M | 23.45 | 25.77% | 5.07% | -0.78% | 313.58% | |
46 Neutral | C$23.88M | -0.93 | 32.72% | ― | -23.24% | -51.96% |
* Consumer Cyclical Sector Average
TSE:MTY
MTY Food Group
37.81
-2.59
-6.42%
TSE:PZA
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10.77
11.47%
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0.27
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-26.03%
TSE:FOOD
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0.24
0.10
71.43%
TSE:AW
A & W Food Services of Canada Inc.
36.03
5.04
16.24%
MTY Food Group Corporate Events
Business Operations and StrategyDividendsFinancial Disclosures
MTY Food Group Posts Higher Profit but Softer Sales in Q1 2026
Neutral
Apr 10, 2026
MTY Food Group reported first-quarter fiscal 2026 results showing modest segment profit growth and sharply higher net income, even as revenue, cash from operations and free cash flow declined amid weaker consumer sentiment. Same-store sales fell 2...
Financial Disclosures
MTY Food Group Schedules Call to Review Q1 2026 Results
Neutral
Apr 2, 2026
MTY Food Group Inc. announced it will hold a conference call for analysts, investors and other interested parties on April 10, 2026, at 8:30 a.m. Eastern Time to discuss its first-quarter 2026 financial results. The company said the results will b...
Business Operations and StrategyFinancial Disclosures
MTY Food Group posts stronger Q4 on gift card breakage and cash flow gains
Positive
Feb 19, 2026
MTY Food Group reported a sharp rebound in fourth-quarter fiscal 2025 results, with segment profits and normalized adjusted EBITDA up 48%, largely driven by a one-time catch-up of gift card breakage income on unused cards. Net income swung to $32....
Business Operations and StrategyFinancial Disclosures
MTY Food Group to Review 2025 Results in February 19 Conference Call
Neutral
Feb 12, 2026
MTY Food Group Inc. will release its fourth-quarter and full-year 2025 financial results on February 19, 2026, and will host a conference call and webcast that morning for analysts, investors and other interested parties. The event will give stake...
Business Operations and StrategyDividends
MTY Food Group Raises Quarterly Dividend by 12%
Positive
Jan 21, 2026
MTY Food Group Inc. has announced a 12% increase in its quarterly dividend, raising the payout from 33.0¢ to 37.0¢ per share, payable on February 13, 2026 to shareholders of record as of February 3, 2026. Management framed the higher div...
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.