Mar. 20 at 7:58 PM
$PTLO Let me get this right...
$750MM EV on
$100MM of EBITDA is 7.5x EV / EBITDA.
If they open 10 restaurants at
$7MM AUV (below current AUV) and 20% unit-level margin (below current margin) that's
$70MM of revenue and
$14MM of incremental EBITDA. If they do that 2 years in a row that's
$140MM revenue
$28MM of EBITDA.
So, we have direct line of site to
$128MM of EBITDA (assuming no organic growth at all!) or 5.85x EV / EBITDA on an extremely achievable target? This is a company that could double it's store count in 5 years if they wanted to (20 stores a year). Even if we assume the next 100 stores generate
$5MM / site at a 15% margin that is
$500MM incremental revenue and
$75MM of incremental EBITDA so we have a company generating
$175MM of EBITDA or 4.3x EV / EBITDA?
Can someone please find me another company that can double and will end up trading at 4.3x EV / EBITDA?
This is so sad. Private Equity is going to take this private so hard.
