Bargain Alert: Heavily Levered US Fast Food Franchise Trading for a Song

This US Fast Food Franchise is among the cheapest in the world

This US-based fast food franchise is most likely the cheapest publicly traded restaurant franchisor, has over 2,700 locations across the United States, and runs an asset-light business model that is 90% franchised and 10% company operated. Despite meaningful scale and stable cash flow rooted in its predominantly franchised model, the company currently trades at less than 3x earnings, and sits at a historically low valuation. Yet this idea is best aimed at the enterprising investor, as the company’s heavy debt load (~8 years operating income) requires close monitoring. Should the company be able to handle this debt (which we think they can), patient investors are looking at multi-bagger returns from here.