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European Wax Center, Inc. (EWCZ)

Company Dividend Discount ModelIndustry: Household & Personal ProductsSector: Consumer Defensive

Valuation Snapshot

Stable Growth$1.83 - $2.63$2.22
Multi-Stage$2.84 - $3.13$2.98
Blended Fair Value$2.60
Current Price$5.80
Upside-55.13%
DecisionDon't Buy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR202420232022202120202019
DPS-31.40%0.00%0.020.074.730.000.000.120.000.000.000.00
YoY Growth---72.31%-98.61%0.00%0.00%-100.00%0.00%0.00%0.00%0.00%0.00%
Dividend Yield--0.51%0.48%24.89%0.00%0.00%0.56%0.00%0.00%0.00%0.00%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)11.24
(-) Cash Dividends Paid (M)0.04
(=) Cash Retained (M)11.20
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)2.251.400.84
Cash Retained (M)11.2011.2011.20
(-) Cash Required (M)-2.25-1.40-0.84
(=) Excess Retained (M)8.959.7910.35
(/) Shares Outstanding (M)43.4043.4043.40
(=) Excess Retained per Share0.210.230.24
LTM Dividend per Share0.000.000.00
(+) Excess Retained per Share0.210.230.24
(=) Adjusted Dividend0.210.230.24
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate-2.00%-1.00%0.00%
Fair Value$1.83$2.22$2.63
Upside / Downside-68.46%-61.70%-54.61%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)11.2411.1211.0110.9010.7910.6911.01
Payout Ratio0.37%18.30%36.22%54.15%72.07%90.00%92.50%
Projected Dividends (M)0.042.043.995.907.789.6210.18

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate-2.00%-1.00%0.00%
Year 1 PV (M)1.851.871.88
Year 2 PV (M)3.283.353.42
Year 3 PV (M)4.414.554.69
Year 4 PV (M)5.275.495.72
Year 5 PV (M)5.916.226.54
PV of Terminal Value (M)102.68108.03113.59
Equity Value (M)123.41129.51135.85
Shares Outstanding (M)43.4043.4043.40
Fair Value$2.84$2.98$3.13
Upside / Downside-50.97%-48.55%-46.03%

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