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Franchise Brands (GB:FRAN)
:FRAN
UK Market

Franchise Brands (FRAN) AI Stock Analysis

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GB

Franchise Brands

(LSE:FRAN)

73Outperform
Franchise Brands exhibits robust financial performance with strong revenue and cash flow growth, supported by a stable balance sheet. Positive corporate events reflect insider confidence which enhances investor trust. However, the stock faces potential technical downside risks due to its trading below key moving averages, and its high P/E ratio may deter value investors. Overall, the company is well-positioned for growth within its industry, but technical and valuation concerns warrant cautious optimism.
Positive Factors
Leadership and Governance
The appointment of Louise George as an independent Non-Executive Director is expected to strengthen the company's governance and financial oversight.
Strategic Initiative
The 'One Franchise Brands' initiative aims to integrate the group into one business, enhancing sales and creating an efficient overhead structure.
Valuation
Analyst recommends buying Franchise Brands with a 300p target price, viewing the current valuation as attractive for a fast-growing international B2B franchise business.
Negative Factors
Earnings Forecast
Adj. EBITDA is expected to be very marginally below the current consensus range, leading to a slight trim in the forecast.
Macroeconomic Conditions
The anticipated recovery in project work is now not expected until next year due to continued macroeconomic uncertainty and challenging conditions in some markets.
Market Speculation
Recent speculation about changes to Inheritance Tax legislation may have contributed to recent volatility in the share price.

Franchise Brands (FRAN) vs. S&P 500 (SPY)

Franchise Brands Business Overview & Revenue Model

Company DescriptionFranchise Brands (FRAN) is a multi-brand franchisor based in the United Kingdom, specializing in building market-leading franchise businesses in the consumer and business services sectors. The company owns a diverse portfolio of franchise brands, enabling it to capitalize on cross-selling opportunities and operational synergies. Its core services include providing support, training, and resources to franchisees, helping them grow and succeed in their respective markets.
How the Company Makes MoneyFranchise Brands makes money primarily through franchise fees and royalty payments from its network of franchisees. Franchise fees are typically paid upfront by franchisees for the right to operate under one of the company's brand names, while ongoing royalties are based on a percentage of franchisees' sales. Additionally, the company may earn revenue from selling products and services to franchisees, as well as from providing marketing, technology, and operational support. Strategic partnerships and acquisitions also play a role in expanding its portfolio and increasing revenue opportunities.

Franchise Brands Financial Statement Overview

Summary
Income Statement
Balance Sheet
Cash Flow
Breakdown
TTMDec 2023Dec 2022Dec 2021Dec 2020Dec 2019
Income StatementTotal Revenue
147.07M121.27M92.73M57.69M49.29M44.01M
Gross Profit
101.41M59.07M30.79M21.93M20.93M16.38M
EBIT
20.69M10.87M8.42M5.84M3.98M3.66M
EBITDA
30.15M22.86M14.25M5.87M5.88M4.65M
Net Income Common Stockholders
9.89M3.04M8.13M4.23M2.79M2.71M
Balance SheetCash, Cash Equivalents and Short-Term Investments
12.28M12.28M10.80M9.05M13.20M1.68M
Total Assets
382.44M382.44M132.44M67.27M68.55M59.05M
Total Debt
94.56M94.56M2.46M2.53M8.24M12.76M
Net Debt
82.28M82.28M-8.34M-6.52M-4.96M11.08M
Total Liabilities
168.05M168.05M29.40M19.94M24.71M31.19M
Stockholders Equity
214.39M214.39M103.04M47.33M43.84M27.86M
Cash FlowFree Cash Flow
35.01M16.89M6.27M5.12M4.46M2.81M
Operating Cash Flow
36.71M19.95M7.73M7.27M5.24M4.52M
Investing Cash Flow
18.55M-51.44M2.56M-3.02M-779.00K-5.66M
Financing Cash Flow
-66.61M33.11M-8.74M-8.40M7.06M-114.00K

Franchise Brands Peers Comparison

Overall Rating
UnderperformOutperform
Sector (62)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
73
Outperform
£255.79M34.923.36%1.74%14.79%165.03%
GBMAB
66
Neutral
£1.35B9.276.35%4.27%
64
Neutral
£863.49M9.4172.38%5.70%0.33%7.13%
GBDOM
62
Neutral
£1.03B11.47
4.07%-2.25%-18.24%
62
Neutral
$7.50B12.893.19%3.38%3.64%-14.27%
59
Neutral
£1.12B40.9912.09%2.49%14.07%236.27%
* Industrials Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
GB:FRAN
Franchise Brands
134.00
-50.54
-27.39%
GB:MAB
Mitchells & Butlers
232.50
-0.50
-0.21%
GB:SSPG
SSP Group plc
138.70
-63.19
-31.30%
GB:FOUR
4Imprint
3,130.00
-3,115.28
-49.88%
GB:DOM
Domino's Pizza
268.20
-55.89
-17.25%

Franchise Brands Corporate Events

Other
Franchise Brands Directors Increase Shareholdings
Positive
Apr 9, 2025

Franchise Brands PLC announced that two of its directors, Stephen Hemsley and Nigel Wray, have each purchased 15,000 ordinary shares at 137.5 pence per share. This transaction reflects a significant vote of confidence in the company’s future prospects by its leadership, potentially strengthening investor trust and enhancing the company’s market position.

Spark’s Take on GB:FRAN Stock

According to Spark, TipRanks’ AI Analyst, GB:FRAN is a Outperform.

Franchise Brands scores well due to its robust financial performance and positive corporate events, indicating insider confidence and strategic growth initiatives. However, technical analysis reveals potential downside risks with the stock trading below key moving averages. The valuation remains somewhat high, which could be a concern for value-focused investors.

To see Spark’s full report on GB:FRAN stock, click here.

Business Operations and Strategy
Franchise Brands Directors Increase Shareholdings, Signaling Confidence in Growth
Positive
Apr 8, 2025

Franchise Brands PLC announced that two of its directors, Stephen Hemsley and Nigel Wray, have each purchased 25,000 ordinary shares at 134 pence per share. This move increases their stakes in the company, with Hemsley now holding 11.78% and Wray 8.26% of the issued share capital. This acquisition reflects the directors’ confidence in the company’s strategic direction and potential for growth, potentially strengthening its market position and signaling positive prospects to stakeholders.

Spark’s Take on GB:FRAN Stock

According to Spark, TipRanks’ AI Analyst, GB:FRAN is a Outperform.

Franchise Brands is supported by strong financial performance and positive corporate events, such as insider confidence and strategic initiatives. However, the technical analysis signals potential downside risk, and the stock’s valuation may deter some investors due to a high P/E ratio.

To see Spark’s full report on GB:FRAN stock, click here.

Business Operations and Strategy
Franchise Brands Directors Increase Shareholdings
Positive
Apr 7, 2025

Franchise Brands PLC announced that two of its directors, Stephen Hemsley and Nigel Wray, have each purchased 25,000 ordinary shares in the company at an average price of 137.1 pence per share. This transaction underscores the directors’ confidence in the company’s growth prospects and could positively influence investor sentiment, potentially impacting the company’s market position and shareholder value.

Regulatory Filings and Compliance
Franchise Brands PLC Announces Change in Voting Rights
Neutral
Apr 4, 2025

Franchise Brands PLC, a UK-based company, has announced a change in its voting rights structure due to an acquisition or disposal of voting rights. Rathbones Investment Management Ltd and Investec Wealth & Investment Limited, both based in London, are involved in this notification. The voting rights attached to shares have decreased slightly from 5.040800% to 4.997900%, indicating a minor shift in shareholder influence. This adjustment may affect the company’s governance dynamics but remains within a stable range, suggesting limited immediate impact on its operations or market positioning.

Business Operations and StrategyFinancial Disclosures
Franchise Brands PLC Announces Live Investor Presentation for 2024 Financial Results
Positive
Apr 2, 2025

Franchise Brands PLC announced a live investor presentation scheduled for April 9, 2025, to discuss its financial results for the year ending December 31, 2024. The presentation, led by key executives, is open to current and potential shareholders, emphasizing the company’s commitment to transparency and stakeholder engagement. This initiative reflects Franchise Brands’ strategic focus on growth and market leadership, potentially enhancing its industry positioning and stakeholder relations.

Shareholder MeetingsFinancial Disclosures
Franchise Brands Releases 2024 Annual Report and AGM Notice
Neutral
Apr 1, 2025

Franchise Brands plc has published its Annual Report and Accounts for the year ending December 31, 2024, which are now accessible on the company’s website. Additionally, materials for the upcoming Annual General Meeting on May 7, 2025, have been distributed to shareholders. This publication is a routine part of the company’s operations, providing transparency and maintaining shareholder engagement, which is crucial for its continued growth and market presence.

Business Operations and Strategy
Franchise Brands Director Increases Shareholding, Signaling Confidence in Growth
Positive
Mar 31, 2025

Franchise Brands PLC announced that Louise George, an Independent Non-Executive Director, has purchased 50,000 ordinary shares, increasing her total shareholding to 150,000 shares, which represents 0.077% of the company’s voting rights. This transaction reflects confidence in the company’s strategic direction and may positively influence stakeholder perception, highlighting the commitment of its leadership to the company’s growth and market position.

Executive/Board ChangesBusiness Operations and StrategyFinancial Disclosures
Franchise Brands Achieves Record Sales and Strengthens Leadership Amid Challenging Conditions
Positive
Mar 27, 2025

Franchise Brands PLC reported a strong financial performance for the year ending December 2024, with a 20% increase in system sales and a 16% rise in adjusted EBITDA, despite challenging macroeconomic conditions. The company launched the ‘One Franchise Brands’ initiative to integrate its operations, enhance sales, and improve efficiency. The appointment of a new CEO and other leadership roles aims to strengthen the company’s strategic execution. The Group’s geographic diversification and focus on essential services have positioned it well for future growth, with an optimistic outlook for 2025.

Financial Disclosures
Franchise Brands to Announce Year-End Financial Results
Neutral
Mar 17, 2025

Franchise Brands plc announced it will release its final results for the year ending December 31, 2024, on March 27, 2025. This announcement is significant as it provides insights into the company’s financial performance and strategic positioning, potentially impacting stakeholders’ perceptions and the company’s market standing.

Business Operations and StrategyRegulatory Filings and Compliance
Franchise Brands PLC Announces Change in Voting Rights
Neutral
Feb 25, 2025

Franchise Brands PLC, a UK-based company, has announced a change in its voting rights structure due to an acquisition or disposal of shares by Slater Investments. As a result, Slater Investments now holds 15.03% of the voting rights in Franchise Brands, up from a previous 14.72%. This change in voting rights could impact the company’s governance and decision-making processes, potentially influencing its strategic direction and operations.

Business Operations and Strategy
Franchise Brands PLC Hosts Strategic Capital Markets Day
Positive
Feb 20, 2025

Franchise Brands PLC is hosting a Capital Markets Day to discuss strategic developments and priorities, introducing the ‘One Franchise Brands’ initiative aimed at integrating the Group to enhance sales and operational efficiency. The company will also outline growth opportunities in large, fragmented markets and emphasize its medium-term growth ambitions and focus on reducing leverage through high cash generation.

Executive/Board ChangesBusiness Operations and Strategy
Franchise Brands Strengthens Leadership Team with Key Appointments
Positive
Feb 13, 2025

Franchise Brands PLC has announced key leadership appointments, enhancing its finance team to support its strategic initiative, ‘One Franchise Brands,’ which aims to integrate its operations, increase sales, improve efficiency, and reduce debt. Andrew Mallows is appointed as the permanent CFO, with Beth Peace as the new Group Finance Director, supporting CEO Peter Molloy in strengthening the company’s market position and operational capabilities.

Executive/Board Changes
Franchise Brands Director Increases Stake with Share Purchase
Positive
Feb 11, 2025

Franchise Brands plc announced that Louise George, an Independent Non-Executive Director, has purchased 100,000 ordinary shares in the company, increasing her total interest to 0.051% of the company’s voting rights. This transaction reflects internal confidence in the company’s market position and may positively influence stakeholder perception, potentially impacting Franchise Brands’ operations and industry positioning.

Business Operations and Strategy
Franchise Brands Announces Strategic ‘One Franchise Brands’ Initiative at Capital Markets Day
Positive
Feb 7, 2025

Franchise Brands PLC is organizing a Capital Markets Day for institutional investors on February 20, 2025, to discuss strategic developments and introduce the ‘One Franchise Brands’ initiative. This initiative aims to integrate the group into a cohesive business structure to boost sales, improve operational efficiency, and decrease debt, potentially enhancing its market position and stakeholder value.

Other
Franchise Brands Directors Increase Shareholding, Signaling Confidence
Positive
Jan 31, 2025

Franchise Brands PLC announced that three of its directors, Stephen Hemsley, Peter Kear, and Nigel Wray, have each purchased 35,000 ordinary shares of the company at an average price of 135.6088 pence per share. These transactions indicate strong insider confidence in the company’s future performance and may positively influence investor perceptions and stakeholder engagement.

Business Operations and StrategyFinancial Disclosures
Franchise Brands Achieves Record Sales Amidst Economic Challenges
Neutral
Jan 28, 2025

Franchise Brands reported record system sales across all key divisions for the financial year ending December 31, 2024, despite challenging macroeconomic conditions. The company’s adjusted EBITDA is slightly below market expectations due to moderated sales growth and fixed cost bases. The strategic initiative ‘One Franchise Brands’ was launched to integrate the group’s businesses, enhance sales, and drive operational efficiencies. The UK, Continental Europe, and North America saw varied growth, with notable performance in essential reactive services. The Group’s adjusted net debt decreased to £65.1m, and the board remains cautiously optimistic for 2025, focusing on integration and cost efficiencies.

Franchise Brands Strengthens Board with Key Appointment
Jan 16, 2025

Franchise Brands has appointed Louise George as an independent Non-Executive Director and Chair of the Audit Committee, enhancing its corporate governance with her extensive financial and franchising experience. Her appointment aligns with the company’s strategic objectives of integration, operational efficiency, and deleveraging, potentially strengthening its market position and growth prospects in the UK, US, and Europe. Additionally, the company will release its year-end trading update on January 28, 2025.

Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.