NasdaqCM:FAT

Stock Analysis Report

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Executive Summary

FAT Brands Inc., a multi-brand franchising company, acquires, develops, and markets fast casual and casual dining restaurant concepts.


Snowflake Analysis

Imperfect balance sheet with weak fundamentals.

Share Price & News

How has FAT Brands's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: FAT's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

-2.6%

FAT

2.4%

US Hospitality

4.3%

US Market


1 Year Return

-14.7%

FAT

-26.4%

US Hospitality

7.4%

US Market

Return vs Industry: FAT exceeded the US Hospitality industry which returned -28.5% over the past year.

Return vs Market: FAT underperformed the US Market which returned 5% over the past year.


Shareholder returns

FATIndustryMarket
7 Day-2.6%2.4%4.3%
30 Day-12.0%-11.0%0.5%
90 Day42.8%33.2%23.0%
1 Year-14.7%-14.7%-24.9%-26.4%9.7%7.4%
3 Yearn/a-16.6%-22.0%38.3%29.2%
5 Yearn/a-0.4%-11.2%66.0%47.6%

Price Volatility Vs. Market

How volatile is FAT Brands's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is FAT Brands undervalued compared to its fair value and its price relative to the market?

13.27x

Price to Book (PB) ratio


Share Price vs. Fair Value

Below Fair Value: FAT ($3.36) is trading above our estimate of fair value ($0.9)

Significantly Below Fair Value: FAT is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: FAT is unprofitable, so we can't compare its PE Ratio to the Hospitality industry average.

PE vs Market: FAT is unprofitable, so we can't compare its PE Ratio to the US market.


Price to Earnings Growth Ratio

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


Price to Book Ratio

PB vs Industry: FAT is overvalued based on its PB Ratio (13.3x) compared to the US Hospitality industry average (1.7x).


Next Steps

Future Growth

How is FAT Brands forecast to perform in the next 1 to 3 years based on estimates from 1 analyst?

25.8%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: FAT is forecast to remain unprofitable over the next 3 years.

Earnings vs Market: FAT is forecast to remain unprofitable over the next 3 years.

High Growth Earnings: FAT is forecast to remain unprofitable over the next 3 years.

Revenue vs Market: FAT's revenue (8.7% per year) is forecast to grow slower than the US market (9.3% per year).

High Growth Revenue: FAT's revenue (8.7% 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 FAT's Return on Equity is forecast to be high in 3 years time


Next Steps

Past Performance

How has FAT Brands performed over the past 5 years?

-96.1%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: FAT is currently unprofitable.

Growing Profit Margin: FAT is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: FAT is unprofitable, and losses have increased over the past 5 years at a rate of -96.1% per year.

Accelerating Growth: Unable to compare FAT's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: FAT is unprofitable, making it difficult to compare its past year earnings growth to the Hospitality industry (-30.8%).


Return on Equity

High ROE: FAT has a negative Return on Equity (-71.68%), as it is currently unprofitable.


Next Steps

Financial Health

How is FAT Brands's financial position?


Financial Position Analysis

Short Term Liabilities: FAT's short term assets ($13.9M) do not cover its short term liabilities ($20.3M).

Long Term Liabilities: FAT's short term assets ($13.9M) do not cover its long term liabilities ($68.1M).


Debt to Equity History and Analysis

Debt Level: FAT's debt to equity ratio (1566.4%) is considered high.

Reducing Debt: Insufficient data to determine if FAT's debt to equity ratio has reduced over the past 5 years.


Balance Sheet


Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: Whilst unprofitable FAT has sufficient cash runway for more than 3 years if it maintains its current positive free cash flow level.

Forecast Cash Runway: FAT is unprofitable but has sufficient cash runway for more than 3 years, due to free cash flow being positive and growing by 11.5% per year.


Next Steps

Dividend

What is FAT Brands's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

Notable Dividend: Unable to evaluate FAT's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate FAT's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if FAT's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if FAT's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: FAT is not paying a notable dividend for the US market.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of FAT's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

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

2.6yrs

Average management tenure


CEO

Andrew Wiederhorn (54yo)

2.75yrs

Tenure

US$413,863

Compensation

Mr. Andrew A. Wiederhorn, also known as Andy, has been Chief Executive Officer, President and Director at FAT Brands Inc. since October 2017. Mr. Wiederhorn has been the Chairman of the Board and Chief Exe ...


CEO Compensation Analysis

Compensation vs Market: Andrew's total compensation ($USD413.86K) is below average for companies of similar size in the US market ($USD606.53K).

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


Leadership Team

NamePositionTenureCompensationOwnership
Andrew Wiederhorn
President2.75yrsUS$413.86k0.013% $5.0k
Rebecca Hershinger
CFO & Corporate Secretary1.92yrsUS$290.60kno data
Ron Roe
Senior Vice President of Finance1.92yrsUS$313.86kno data
Donald Berchtold
Executive VP & Chief Concept Officer2.42yrsUS$413.86kno data
Thayer Wiederhorn
Chief Marketing Officer3.33yrsno datano data
Taylor Wiederhorn
Chief Development Officer3.33yrsno datano data
Gregg Nettleton
President & COO of Casual Dining Division2.75yrsUS$219.01kno data
Toni Bianco
President & COO of Fatburger2.42yrsno datano data

2.6yrs

Average Tenure

51.5yo

Average Age

Experienced Management: FAT's management team is considered experienced (2.6 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Andrew Wiederhorn
President2.75yrsUS$413.86k0.013% $5.0k
Edward Rensi
Independent Chairman of the Board2.75yrsUS$74.83k0.28% $112.7k
James Neuhauser
Independent Director2.75yrsUS$74.83k0.59% $235.4k
Squire Junger
Independent Director2.75yrsUS$74.83k0.46% $184.0k

2.8yrs

Average Tenure

65.5yo

Average Age

Experienced Board: FAT's board of directors are not considered experienced ( 2.8 years average tenure), which suggests a new board.


Ownership

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


Insider Trading Volume

Insider Buying: FAT 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.


Top Shareholders

Company Information

FAT Brands Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: FAT Brands Inc.
  • Ticker: FAT
  • Exchange: NasdaqCM
  • Founded: 2017
  • Industry: Restaurants
  • Sector: Consumer Services
  • Market Cap: US$39.967m
  • Shares outstanding: 11.89m
  • Website: https://www.fatbrands.com

Number of Employees


Location

  • FAT Brands Inc.
  • 9720 Wilshire Boulevard
  • Suite 500
  • Beverly Hills
  • California
  • 90212
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
FATNasdaqCM (Nasdaq Capital Market)YesCommon StockUSUSDOct 2017

Biography

FAT Brands Inc., a multi-brand franchising company, acquires, develops, and markets fast casual and casual dining restaurant concepts. As of June 29, 2020, it owned 8 restaurant brands, including Fatburger, Buffalo’s Cafe, Buffalo’s Express, Hurricane Grill & Wings, Elevation Burger, Yalla Mediterranean, Ponderosa, and Bonanza Steakhouse, as well as franchised approximately 375 units worldwide. The company was founded in 2017 and is headquartered in Beverly Hills, California. FAT Brands Inc. is a subsidiary of Fog Cutter Capital Group Inc. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/07/07 00:11
End of Day Share Price2020/07/06 00:00
Earnings2020/03/29
Annual Earnings2019/12/29


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.