MTY Food Group (TSX:MTY) - Share price, News & Analysis

MTY fundamental analysis
Snowflake Score
Valuation	3/6
Future Growth	0/6
Past Performance	2/6
Financial Health	3/6
Dividends	3/6

MTY Stock Overview

MTY Food Group Inc. franchises and operates quick-service, fast-casual, and casual dining restaurants in Canada, the United States, and internationally.

Rewards

Trading at 43.2% below our estimate of its fair value

Became profitable this year

Risk Analysis

Earnings have declined by 9.2% per year over past 5 years

Has a high level of debt

MTY Food Group Competitors

Price History & Performance

Summary of all time highs, changes and price drops for MTY Food Group
Historical stock prices
Current Share Price	CA$49.09
52 Week High	CA$72.10
52 Week Low	CA$47.90
Beta	2.04
1 Month Change	-10.32%
3 Month Change	-2.25%
1 Year Change	-18.02%
3 Year Change	-17.97%
5 Year Change	3.98%
Change since IPO	13,925.71%

Recent News & Updates

Apr 11

Is MTY Food Group (TSE:MTY) Using Too Much Debt?

Warren Buffett famously said, 'Volatility is far from synonymous with risk.' So it seems the smart money knows that...

Shareholder Returns

	MTY	CA Hospitality	CA Market
7D	-6.4%	-2.3%	-0.7%
1Y	-18.0%	-22.8%	5.2%

Return vs Industry: MTY exceeded the Canadian Hospitality industry which returned -22.4% over the past year.

Return vs Market: MTY underperformed the Canadian Market which returned 4.8% over the past year.

Price Volatility

Is MTY's price volatile compared to industry and market?
MTY volatility
MTY Average Weekly Movement	5.6%
Hospitality Industry Average Movement	5.7%
Market Average Movement	9.8%
10% most volatile stocks in CA Market	16.9%
10% least volatile stocks in CA Market	4.3%

Stable Share Price: MTY is less volatile than 75% of Canadian stocks over the past 3 months, typically moving +/- 6% a week.

Volatility Over Time: MTY's weekly volatility (6%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1979	1,978	Eric Lefebvre	https://mtygroup.com

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, the company had 6,719 locations comprising 6,603 franchised, 23 joint ventures, and 93 corporate locations.

MTY Food Group Fundamentals Summary

How do MTY Food Group's earnings and revenue compare to its market cap?
MTY fundamental statistics
Market Cap	CA$1.20b
Earnings (TTM)	CA$88.88m
Revenue (TTM)	CA$573.44m

13.5x

P/E Ratio

2.1x

P/S Ratio

Is MTY overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
MTY income statement (TTM)
Revenue	CA$573.44m
Cost of Revenue	CA$57.76m
Gross Profit	CA$515.68m
Other Expenses	CA$426.80m
Earnings	CA$88.88m

Last Reported Earnings

Feb 28, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	3.64
Gross Margin	89.93%
Net Profit Margin	15.50%
Debt/Equity Ratio	56.5%

How did MTY perform over the long term?

See historical performance and comparison

Dividends

1.7%

Current Dividend Yield

16%

Payout Ratio

Valuation

Is MTY Food Group undervalued compared to its fair value and its price relative to the market?

Valuation Score

3/6

Valuation Score 3/6

Below Fair Value
Significantly Below Fair Value
PE vs Industry
PE vs Market
PEG Ratio
PB vs Industry

43.2%

Undervalued compared to fair value

Share Price vs. Fair Value

Below Fair Value: MTY (CA$49.09) is trading below our estimate of fair value (CA$86.4)

Significantly Below Fair Value: MTY is trading below fair value by more than 20%.

Price To Earnings Ratio

PE vs Industry: MTY is good value based on its Price-To-Earnings Ratio (13.5x) compared to the Canadian Hospitality industry average (14.9x).

PE vs Market: MTY is poor value based on its Price-To-Earnings Ratio (13.5x) compared to the Canadian market (11.3x).

Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate MTY's PEG Ratio to determine if it is good value.

Price to Book Ratio

PB vs Industry: MTY is overvalued based on its Price-To-Book Ratio (1.9x) compared to the CA Hospitality industry average (1.7x).

Future Growth

How is MTY Food Group forecast to perform in the next 1 to 3 years based on estimates from 6 analysts?

Future Growth Score

0/6

Future Growth Score 0/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

3.9%

Forecasted annual revenue growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: Insufficient data to determine if MTY's forecast earnings growth is above the savings rate (1.6%).

Earnings vs Market: Insufficient data to determine if MTY's earnings are forecast to grow faster than the Canadian market

High Growth Earnings: Insufficient data to determine if earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: MTY's revenue (3.9% per year) is forecast to grow slower than the Canadian market (6.4% per year).

High Growth Revenue: MTY's revenue (3.9% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: Insufficient data to determine if MTY's Return on Equity is forecast to be high in 3 years time

Past Performance

How has MTY Food Group performed over the past 5 years?

Past Performance Score

2/6

Past Performance Score 2/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

-9.2%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: MTY has high quality earnings.

Growing Profit Margin: MTY became profitable in the past.

Past Earnings Growth Analysis

Earnings Trend: MTY's earnings have declined by 9.2% per year over the past 5 years.

Accelerating Growth: MTY has become profitable in the last year, making the earnings growth rate difficult to compare to its 5-year average.

Earnings vs Industry: MTY has become profitable in the last year, making it difficult to compare its past year earnings growth to the Hospitality industry (52.7%).

Return on Equity

High ROE: MTY's Return on Equity (13.9%) is considered low.

Financial Health

How is MTY Food Group's financial position?

Financial Health Score

3/6

Financial Health Score 3/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: MTY's short term assets (CA$230.5M) do not cover its short term liabilities (CA$381.0M).

Long Term Liabilities: MTY's short term assets (CA$230.5M) do not cover its long term liabilities (CA$874.6M).

Debt to Equity History and Analysis

Debt Level: MTY's net debt to equity ratio (48.3%) is considered high.

Reducing Debt: MTY's debt to equity ratio has reduced from 78.5% to 56.5% over the past 5 years.

Debt Coverage: MTY's debt is well covered by operating cash flow (40.8%).

Interest Coverage: MTY's interest payments on its debt are well covered by EBIT (12.5x coverage).

Balance Sheet

Dividend

What is MTY Food Group current dividend yield, its reliability and sustainability?

Dividend Score

2/6

Dividend Score 2/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Future Dividend Coverage

1.71%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: MTY's dividend (1.71%) isn’t notable compared to the bottom 25% of dividend payers in the Canadian market (1.9%).

High Dividend: MTY's dividend (1.71%) is low compared to the top 25% of dividend payers in the Canadian market (4.91%).

Stability and Growth of Payments

Stable Dividend: MTY's dividend payments have been volatile in the past 10 years.

Growing Dividend: MTY's dividend payments have increased over the past 10 years.

Earnings Payout to Shareholders

Earnings Coverage: With its low payout ratio (16.1%), MTY's dividend payments are well covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: With its low cash payout ratio (14.7%), MTY's dividend payments are thoroughly covered by cash flows.

Discover strong dividend paying companies

Management

How experienced are the management team and are they aligned to shareholders interests?

4.2yrs

Average management tenure

CEO

Eric Lefebvre (44 yo)

3.5yrs

Tenure

CA$530,381

Compensation

Mr. Eric Lefebvre, CPA, CA, MBA, has been Chief Executive Officer of MTY Food Group Inc since November 5, 2018 and has been its Director May 28, 2018. He joined MTY in 2009 as Vice-President and Controller...

CEO Compensation Analysis

Compensation vs Market: Eric's total compensation ($USD412.47K) is below average for companies of similar size in the Canadian market ($USD1.54M).

Compensation vs Earnings: Eric's compensation has been consistent with company performance over the past year.

Leadership Team

Experienced Management: MTY's management team is considered experienced (4.2 years average tenure).

Board Members

Experienced Board: MTY's board of directors are seasoned and experienced ( 11 years average tenure).

Ownership

Who are the major shareholders and have insiders been buying or selling?

Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.

Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.

Data	Last Updated (UTC time)
Company Analysis	2022/05/24 00:00
End of Day Share Price	2022/05/24 00:00
Earnings	2022/02/28
Annual Earnings	2021/11/30