Stock Analysis

Muscle Maker, Inc.'s (NASDAQ:GRIL) Path To Profitability

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With the business potentially at an important milestone, we thought we'd take a closer look at Muscle Maker, Inc.'s (NASDAQ:GRIL) future prospects. Muscle Maker, Inc. owns, operates, and franchises Muscle Maker Grill and Healthy Joe’s restaurants under the Muscle Maker Grill name. The US$12m market-cap company posted a loss in its most recent financial year of US$10m and a latest trailing-twelve-month loss of US$7.7m shrinking the gap between loss and breakeven. As path to profitability is the topic on Muscle Maker's investors mind, we've decided to gauge market sentiment. In this article, we will touch on the expectations for the company's growth and when analysts expect it to become profitable.

Check out our latest analysis for Muscle Maker

Expectations from some of the American Hospitality analysts is that Muscle Maker is on the verge of breakeven. They expect the company to post a final loss in 2022, before turning a profit of US$3.0m in 2023. The company is therefore projected to breakeven just over a year from now. How fast will the company have to grow each year in order to reach the breakeven point by 2023? Working backwards from analyst estimates, it turns out that they expect the company to grow 86% year-on-year, on average, which signals high confidence from analysts. Should the business grow at a slower rate, it will become profitable at a later date than expected.

NasdaqCM:GRIL Earnings Per Share Growth February 22nd 2022

We're not going to go through company-specific developments for Muscle Maker given that this is a high-level summary, though, bear in mind that generally a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

Before we wrap up, there’s one aspect worth mentioning. The company has managed its capital prudently, with debt making up 12% of equity. This means that it has predominantly funded its operations from equity capital, and its low debt obligation reduces the risk around investing in the loss-making company.

Next Steps:

There are too many aspects of Muscle Maker to cover in one brief article, but the key fundamentals for the company can all be found in one place – Muscle Maker's company page on Simply Wall St. We've also compiled a list of relevant factors you should look at:

  1. Valuation: What is Muscle Maker worth today? Has the future growth potential already been factored into the price? The intrinsic value infographic in our free research report helps visualize whether Muscle Maker is currently mispriced by the market.
  2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Muscle Maker’s board and the CEO’s background.
  3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.

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  • Revenue is forecast to grow 26.35% per year

  • Earnings have grown 12.5% per year over the past 5 years


  • Shareholders have been substantially diluted in the past year

  • Does not have a meaningful market cap ($51M)

  • Volatile share price over the past 3 months

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