Collins Foods (6CF) AI Stock Analysis

Collins Foods

(Frankfurt:6CF)

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Positive Factors

Strong revenue and underlying profit growthRecord revenue and underlying profit growth indicate continued customer demand and effective execution across the restaurant network. Sustained top-line expansion gives Collins Foods greater operating scale, supports reinvestment in stores and technology, and strengthens earnings potential over the next several quarters.

Negative Factors

Elevated leverage limits financial flexibilityAlthough recent net debt and net leverage improved, debt remains elevated relative to equity and constrains financial flexibility. Higher leverage can limit the pace of investment, reduce resilience if restaurant profitability weakens, and increase the importance of disciplined capital allocation across markets.

Collins Foods (6CF) vs. iShares MSCI Germany ETF (EWG)

Market Cap: EUR 669.19M
Dividend Yield: 2.36%
Average Volume (3M): 300
Price to Earnings (P/E): 24.4
Beta (1Y): 0.50
Revenue Growth: -0.08%
EPS Growth: 342.65%
Country: Germany
Employees: 22,027
Sector: Consumer Cyclical
Sector Strength: 61
Industry: Restaurants

Collins Foods Business Overview & Revenue Model

Company Description

Collins Foods Limited operates and manages restaurants across Australia, Europe, and Asia, featuring a diverse portfolio of well-known brands such as KFC, Taco Bell, and Sizzler. As of December 31, 2021, the company oversaw 261 franchised KFC establi...

Collins Foods Earnings Call Summary

Earnings Call Date:Jun 28, 2026(Q4-2026)|% Change Since:13.04%|Next Earnings Date:Dec 07, 2026

Earnings Call SentimentPositive

The call reported a strong set of FY26 financial results with record revenue, record underlying NPAT, improved cash generation, reduced net debt and clear strategic progress (KFC Australia momentum, German expansion, Kwench rollout, Taco Bell exit, sustainability achievements). However, management acknowledged notable near-term challenges: margin compression from delivery fee changes and higher protein costs, impaired European trading trends into early FY27 driven by macro events (conflict, fuel, heatwaves), avian flu-driven poultry cost pressure, and one-off charges. Overall the positives (record financials, balance sheet improvement, operational wins and clear growth initiatives) outweigh the negatives, which management characterizes as manageable and addressable in FY27 through product, cost actions and strategic investment.

Positive Updates

Record Revenue

Revenue from continuing operations of $1.59 billion, up 8.6% year-on-year (FY26); group revenue including discontinued Taco Bell was $1.64 billion (Taco Bell contributed $47.7m).

Negative Updates

Margin Compression and Cost Headwinds

Underlying EBITDA margin slipped (absolute profits up but margin down ~34 basis points) due to delivery fee structure changes, value investments, and higher protein costs in Europe; Australian restaurant-level EBITDA margin reduced 26 basis points to 21%.

Company Guidance

Guidance from the call was that Collins will continue investment-led growth while maintaining a conservative financial profile: FY27 plans include 7–10 new restaurants in Australia and ~7 in Germany, an A$35m (reported $35m) rollout of Kwench targeting 80% of Australian sites by April, ~ $20m FY27 capex in Germany plus a $3m upfront acceleration spend, and a mid‑term ambition to add 45–90 German restaurants by FY30; incremental G&A of $2m in Australia and $3m in Germany was flagged. Financial priorities are strict capital discipline with R&D/entry‑ticket and supplier entry metrics targeted below 8%, a high‑ROCE hurdle for investments, preservation of an investment‑grade balance sheet, and a progressive absolute dividend policy (FY26 fully franked dividend $0.28/share, final $0.15/share), alongside an expected EUR350m dividend from Mobilize Financial Services. Cash/earnings guidance points to continued strong cash generation (FY26 cash conversion 94%, net operating cash flow before interest and tax $232.6m and after interest/tax $150.1m), lower net debt (FY26 net debt $119.6m, net leverage 0.77 vs 0.93 FY25) and free cash flow “above historical averages”; management flagged a circa 5.5% margin guidance corridor (for 2026), modest commodity inflation in Australia, easing poultry pressure in Europe, and FX/headwinds to be managed.

Collins Foods Peers Comparison

Overall Rating

UnderperformOutperform

Sector (61)

Financial Indicators

DE:6CF against its peers
Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	61Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
AU:GYG	56Neutral	AUD 2.55B	-94.11	-8.88%	0.77%	19.36%	-286.26%
AU:DMP	54Neutral	AUD 2.05B	-15.26	-23.54%	2.65%	-11.19%	-2942.58%
AU:OLI	50Neutral	AUD 3.24M	5.45	-3.26%	―	-7.68%	―
AU:RFG	50Neutral	AUD 51.87M	45.81	0.57%	―	-9.06%	―
AU:SGR	47Neutral	AUD 1.04B	-2.55	-64.40%	―	-9.32%	59.25%

* Consumer Cyclical Sector Average

Performance Comparison

DE:6CF and its peers over the selected period
Ticker	Company Name	Price	Change	% Change
DE:6CF	Collins Foods Limited	5.60	-0.12	-2.01%
AU:DMP	Domino's Pizza Enterprises Limited	21.67	3.83	21.48%
AU:SGR	Star Entertainment Group Limited	0.15	0.07	72.22%
AU:RFG	Retail Food Group Limited	0.82	-0.59	-41.84%
AU:OLI	Oliver's Real Food Ltd.	0.01	0.00	0.00%
AU:GYG	Guzman y Gomez Ltd.	25.41	0.52	2.10%

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

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.

Collins Foods AI Stock Analysis