MTY Food Group (TSE:MTY)
TSX:MTY
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MTY Food Group
(TSX:MTY)
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Rating:67Neutral
Price Target:
C$43.00
▲(10.34% Upside)
Action:ReiteratedDate:03/26/26
The score is driven by attractive valuation (low P/E and solid dividend yield) and strong cash generation, offset by leverage and earnings volatility. Technical signals are modestly bearish and the earnings call flagged underlying same-store sales pressure and a meaningful one-time boost to Q4 results.
Positive Factors
Franchise-driven scale growth
MTY’s franchise-first model and multi-year scale expansion create durable recurring royalty and fee income. Rising system sales and unit base increase purchasing leverage and lower capital intensity versus company‑operated growth, supporting margin sustainability and long‑term cash generation.
Negative Factors
Elevated leverage
Material leverage limits financial flexibility and raises refinancing and interest expense risk if margins or cash flow weaken. Operating cash flow covers less than half of total debt historically, so cyclic or persistent same‑store pressure could slow deleveraging and constrain capital allocation choices.
Read all positive and negative factors
Positive Factors
Negative Factors
Franchise-driven scale growth
MTY’s franchise-first model and multi-year scale expansion create durable recurring royalty and fee income. Rising system sales and unit base increase purchasing leverage and lower capital intensity versus company‑operated growth, supporting margin sustainability and long‑term cash generation.
Read all positive factors
MTY Food Group (MTY) vs. iShares MSCI Canada ETF (EWC)
Market Cap
C$890.13M
Dividend Yield3.51%
Average Volume (3M)77.28K
Price to Earnings (P/E)7.3
Beta (1Y)0.93
Revenue Growth1.38%
EPS Growth-64.10%
CountryCA
Employees7,632
SectorConsumer Cyclical
Sector Strength84
IndustryRestaurants
Share Statistics
EPS (TTM)1.88
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$46.61Price Target Upside19.61% Upside
Rating ConsensusHold
Number of Analyst Covering5
EPS Forecast (FY)4.26
Revenue Forecast (FY)C$1.14B
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:Feb 19, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Apr 10, 2026
Earnings Call Sentiment Neutral
The call presented a mix of encouraging financial and operational progress—notably positive net unit growth, strong free cash flow generation, lower leverage, segment improvements (corporate stores and processing/distribution), and an increased dividend—while also highlighting clear operational headwinds: weaker same-store sales (especially in the U.S.), U.S. franchise profit decline, ongoing macro and competitive pressures, and a material one-time $29.5M gift card breakage that significantly inflated quarterly EBITDA and net income. Management emphasized multi-brand development, digital and loyalty deployments and disciplined capital allocation, but underlying operational volatility (Papa Murphy's and U.S. segment pressure) tempers the headline results.Positive Updates
Net Unit Growth and Healthier Store Network
Q4 net addition of 19 locations; company moved into positive net unit growth on an annual basis for the first time since 2013. Management describes the store network as the healthiest in over a decade and notes a deepening development pipeline (notably Cold Stone, Wetzel's, Taco Time Canada and Thai Express).
Negative Updates
Same-Store Sales Decline
Overall same-store sales declined 1.7% in Q4. Canada was flat while the U.S. same-store sales declined 2.8%. Management noted ongoing macro pressure and competitive promotional intensity, particularly in pizza and some U.S. casual dining banners.
Read all updates
Q4-2025 Updates
Positive
Negative
Net Unit Growth and Healthier Store Network
Q4 net addition of 19 locations; company moved into positive net unit growth on an annual basis for the first time since 2013. Management describes the store network as the healthiest in over a decade and notes a deepening development pipeline (notably Cold Stone, Wetzel's, Taco Time Canada and Thai Express).
Read all positive updates
Company Guidance
Management guided that, excluding normal seasonal Q1 weakness, the positive momentum from Q4 (19 net new locations and the first annual net unit growth since 2013) should continue into 2026, with the expectation that franchisee EBITDA will outpace same‑store sales (Q4 same‑store sales -1.7% overall; Canada flat; U.S. -2.8%). They said the $29.5M one‑time gift‑card breakage catch‑up is non‑recurring and future usage should remain consistent, reiterated a conservative capital plan with 2025’s lower CapEx as the new normal, and signaled priorities to increase optionality by reducing debt (net debt ~ $580M; net debt/EBITDA ~2x) while sustaining shareholder returns (quarterly dividend up 12% to $0.37). Key metrics cited to support the guidance included normalized adjusted EBITDA of $87.7M in Q4 (+48% YoY, driven in part by the breakage), corporate store profit $7.9M (+23%, 7% margin vs 5% prior, target toward high single digits), Food Processing revenue +27% (11% margins), Q4 cash flow from operations $46.2M, free cash flow net of lease repayments $37.6M (+38% YoY), and free cash flow per share net of leases $5.68 for 2025.MTY Food Group Financial Statement Overview
Summary
Income Statement
76
Positive
Balance Sheet
55
Neutral
Cash Flow
72
Positive
| Breakdown | Nov 2025 | Nov 2024 | Nov 2023 | Nov 2022 | Nov 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 1.19B | 1.16B | 1.17B | 716.52M | 551.90M |
| Gross Profit | 355.67M | 419.18M | 340.98M | 255.40M | 300.62M |
| EBITDA | 289.69M | 165.34M | 263.02M | 165.60M | 169.80M |
| Net Income | 118.99M | 24.17M | 104.08M | 74.82M | 85.64M |
Balance Sheet | |||||
| Total Assets | 2.51B | 2.59B | 2.68B | 2.33B | 1.90B |
| Cash, Cash Equivalents and Short-Term Investments | 51.99M | 50.41M | 58.90M | 59.48M | 61.23M |
| Total Debt | 1.52B | 1.22B | 1.30B | 1.08B | 834.28M |
| Total Liabilities | 1.65B | 1.78B | 1.87B | 1.60B | 1.26B |
| Stockholders Equity | 856.42M | 801.84M | 811.41M | 723.41M | 647.64M |
Cash Flow | |||||
| Free Cash Flow | 169.47M | 177.08M | 152.42M | 130.14M | 132.54M |
| Operating Cash Flow | 182.98M | 204.81M | 184.59M | 142.80M | 139.30M |
| Investing Cash Flow | -7.82M | -23.54M | -319.66M | -258.42M | 7.20M |
| Financing Cash Flow | -173.67M | -186.78M | 135.94M | 105.30M | -129.58M |
MTY Food Group Technical Analysis
Neutral
38.97
Price Trends
40.82
Negative
39.16
Negative
38.42
Positive
Market Momentum
-0.51
Negative
45.75
Neutral
57.95
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:MTY, the sentiment is Neutral. The current price of 38.97 is below the 20-day moving average (MA) of 38.98, below the 50-day MA of 40.82, and above the 200-day MA of 38.42, indicating a neutral trend. The MACD of -0.51 indicates Negative momentum. The RSI at 45.75 is Neutral, neither overbought nor oversold. The STOCH value of 57.95 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral 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$510.31M | 16.62 | 10.35% | 5.98% | 1.35% | -1.11% | |
67 Neutral | C$890.13M | 7.28 | 3.64% | 3.51% | 1.38% | -64.10% | |
62 Neutral | C$894.26M | 16.42 | 27.32% | 5.07% | -2.54% | -10.57% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
| ― | C$50.34B | 29.37 | 25.66% | 3.58% | 19.92% | -18.34% | |
43 Neutral | C$19.16M | -2.15 | 32.72% | ― | -20.91% | -109.64% |
* Consumer Cyclical Sector Average
TSE:MTY
MTY Food Group
38.97
1.31
3.48%
TSE:PZA
Pizza Pizza Royalty
15.30
3.05
24.91%
TSE:QSP.UN
Restaurant BrndLP
109.09
18.62
20.59%
TSE:AEG
Aegis Brands
0.29
-0.07
-19.44%
TSE:FOOD
Goodfood Market Corp
0.20
>-0.01
-4.88%
TSE:AW
A & W Food Services of Canada Inc.
37.25
8.15
28.02%
MTY Food Group Corporate Events
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.