Does Mister Car Wash Offer Value After Latest Stock Decline in 2025?

Thinking about Mister Car Wash stock and not sure whether to buy, hold, or move on? You’re not alone. After all, shares closed recently at $4.79, and it’s no surprise many investors are trying to make sense of what’s next. On one hand, the stock has clawed back 1.5% in the last week, raising eyebrows among short-term traders. On the other hand, Mister Car Wash is still down more than 34% year-to-date and off 41.4% over the past three years, which has put a cloud over its shine. That kind of long-term drop often signals either a potential opportunity or a clear red flag, depending on how you look under the hood.

So, what’s really going on? Part of the recent negative trend matches a broader shift in how the market is viewing certain growth stocks and companies tied closely to consumer spending. Even so, Mister Car Wash is starting to pop up on watchlists for those searching for a bargain, especially since it currently earns a valuation score of 5. That means it’s undervalued in five out of six classic valuation checks, which doesn’t happen every day.

If you’re the type who wants to invest with confidence, knowing how Mister Car Wash stacks up on different valuation methods is essential. In the next section, we’ll dig into these approaches, but stick around, because at the end, I’ll share a smarter, more holistic way to think about valuation that most investors miss.

Why Mister Car Wash is lagging behind its peers

Approach 1: Mister Car Wash Discounted Cash Flow (DCF) Analysis

The Discounted Cash Flow (DCF) model estimates what a company's business is worth by projecting its future cash flows and then discounting those amounts back to today's dollars. This approach helps capture not just where Mister Car Wash is today but also where it could be headed based on how much cash it might generate for shareholders.

Starting with the company's latest available numbers, Mister Car Wash reported negative Free Cash Flow (FCF) of $-52.1 Million over the last twelve months. However, analysts expect substantial improvement, forecasting FCF to reach about $58.9 Million by the end of 2027. Looking out to 2035, expanding analyst estimates and trend extrapolations by Simply Wall St suggest Mister Car Wash's FCF could rise steadily, with projected annual amounts such as $23.6 Million in 2026 and $49.5 Million in 2027, reaching up to $114.9 Million (discounted value) by 2035.

Based on these projections and using a two-stage Free Cash Flow to Equity model, the estimated intrinsic value per share comes to $8.74. With Mister Car Wash stock recently closing at $4.79, the DCF valuation implies the company is 45.2% undervalued compared to its fundamental long-term worth.

Result: UNDERVALUED

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Mister Car Wash.

Our Discounted Cash Flow (DCF) analysis suggests Mister Car Wash is undervalued by 45.2%. Track this in your watchlist or portfolio, or discover more undervalued stocks.

Approach 2: Mister Car Wash Price vs Earnings (PE Ratio)

The Price-to-Earnings (PE) ratio is a widely used metric for valuing profitable companies because it tells investors how much they are paying for each dollar of company earnings. For Mister Car Wash, which is currently generating positive earnings, the PE ratio sheds light on what the market expects in terms of future profitability and how much risk investors are willing to take on.

Higher growth expectations and lower risk tend to justify a higher PE ratio, while companies facing slower growth or more uncertainty often trade at lower multiples. Mister Car Wash currently trades at a PE ratio of 18.0x. This compares closely to both its industry average of 17.5x and a peer group average of 18.1x, suggesting the market views its prospects as broadly in line with other consumer service businesses.

Simply Wall St’s proprietary “Fair Ratio” refines these common benchmarks by considering not only peer and industry comparisons, but also factors unique to Mister Car Wash such as its expected earnings growth, profit margins, risk profile, and market cap. For Mister Car Wash, the Fair Ratio stands at 23.7x. This is higher than both the current and industry multiples, indicating that, after accounting for company-specific dynamics, Mister Car Wash may actually be undervalued at today’s price.

Result: UNDERVALUED

PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover companies where insiders are betting big on explosive growth.

Upgrade Your Decision Making: Choose your Mister Car Wash Narrative

Earlier we mentioned that there's an even better way to understand valuation, so let's introduce you to Narratives. A Narrative is a story, your own perspective, that connects everything you believe about a company to a financial forecast and, ultimately, a fair value. Instead of just relying on numbers or ratios, Narratives let you spell out your view on Mister Car Wash: how they’ll grow revenue or margins, what risks or strengths matter most, and why you think their future will look a certain way.

Narratives make investing more accessible and interactive. They are easy to create and update right on Simply Wall St's Community page, where millions of investors share their own views. When new information comes in, like earnings announcements or industry news, your Narrative’s calculations update automatically to keep you in the loop.

This approach helps you decide when to buy, hold, or sell by letting you compare your Narrative's dynamically-calculated Fair Value to the current share price. For Mister Car Wash right now, some investors are optimistic and forecast high subscription growth and margin gains, assigning a Fair Value as high as $11.00 per share. More cautious investors, focusing on competitive pressures and cost risks, give a Fair Value closer to $6.00, proving there is no single story, just the one that fits your view.

Do you think there's more to the story for Mister Car Wash? Create your own Narrative to let the Community know!

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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