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Meritage Hospitality Group
(OTC:MHGUQ)
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Rating:39Underperform
Price Target:
$0.06
▼(-97.00% Downside)
Action:Reiterated
Date:10/08/26
The score is driven primarily by weak financial performance (losses, compressed margins, very high leverage, and negative free cash flow). Technical indicators reinforce the downside case with severe weakness versus moving averages and bearish momentum signals. Valuation offers limited support due to negative earnings and no provided dividend yield.
Positive Factors
Established Franchise Operating Model
A focused franchisee model gives Meritage an established framework for operating branded quick-service restaurants and serving a broad customer base. Its concentration in recognized restaurant concepts can support operating consistency and provide a platform for managing multiple locations over the medium term.
Negative Factors
Severe Profitability Deterioration
The shift from profitability to sizable losses, together with sharply compressed EBITDA margins, indicates materially weaker operating leverage. Persistently thin or negative margins reduce the company’s ability to absorb cost pressure, reinvest in locations, and rebuild earnings over the next several quarters.
Read all positive and negative factors
Positive Factors
Negative Factors
Established Franchise Operating Model
A focused franchisee model gives Meritage an established framework for operating branded quick-service restaurants and serving a broad customer base. Its concentration in recognized restaurant concepts can support operating consistency and provide a platform for managing multiple locations over the medium term.
Read all positive factors
Meritage Hospitality Group (MHGUQ) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$364.28K
Dividend Yield1.23%
Average Volume (3M)51.97K
Price to Earnings (P/E)―
Beta (1Y)-0.31
Revenue Growth-12.04%
EPS Growth-8862.22%
CountryUS
Employees10,000
SectorConsumer Cyclical
Sector Strength84
IndustryRestaurants
Share Statistics
EPS (TTM)-8.02
Shares Outstanding6,745,888
10 Day Avg. Volume5,206
30 Day Avg. Volume51,967
Financial Highlights & Ratios
PEG Ratio<0.01
Price to Book (P/B)0.15
Price to Sales (P/S)0.02
P/FCF Ratio-0.73
Enterprise Value/Market Cap1.52K
Enterprise Value/Revenue0.97
Enterprise Value/Gross Profit3.08
Enterprise Value/Ebitda214.37
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
Meritage Hospitality Group Business Overview & Revenue Model
Company Description
Meritage Hospitality Group Inc. oversees and manages various quick-service and casual dining establishments. The company operates restaurants under the widely recognized Wendy's banner, as well as its own distinct brands: Morning Belle, Stan's Tac...
Meritage Hospitality Group Financial Statement Overview
Summary
Income Statement
28
Negative
Balance Sheet
18
Very Negative
Cash Flow
20
Very Negative
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 573.21M | 617.70M | 668.80M | 672.49M | 626.04M | 577.13M |
| Gross Profit | 180.32M | 241.10M | 277.53M | 80.89M | 252.19M | 242.96M |
| EBITDA | 2.59M | 10.09M | 37.55M | 41.16M | 39.04M | 47.35M |
| Net Income | -50.84M | -31.75M | 7.80M | 6.14M | 8.48M | 17.45M |
Balance Sheet | ||||||
| Total Assets | 725.89M | 754.76M | 810.16M | 816.90M | 791.32M | 758.63M |
| Cash, Cash Equivalents and Short-Term Investments | 18.14M | 11.47M | 20.85M | 19.43M | 35.37M | 49.95M |
| Total Debt | 552.42M | 572.17M | 598.53M | 615.94M | 586.15M | 567.88M |
| Total Liabilities | 651.25M | 656.30M | 681.35M | 694.87M | 674.12M | 649.95M |
| Stockholders Equity | 73.54M | 97.21M | 127.67M | 121.14M | 116.15M | 105.76M |
Cash Flow | ||||||
| Free Cash Flow | -10.48M | -19.98M | -16.98M | -33.90M | -41.02M | -45.53M |
| Operating Cash Flow | 1.75M | 4.94M | 23.12M | 11.46M | 25.75M | 38.58M |
| Investing Cash Flow | -9.11M | -19.72M | -32.24M | -74.83M | -83.24M | -83.27M |
| Financing Cash Flow | 7.89M | 5.40M | 10.53M | 47.44M | 42.91M | 62.32M |
Meritage Hospitality Group Technical Analysis
Negative
1.90
Price Trends
1.54
Negative
1.89
Negative
2.18
Negative
Market Momentum
-0.49
Negative
15.99
Positive
25.88
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MHGUQ, the sentiment is Negative. The current price of 1.9 is above the 20-day moving average (MA) of 0.55, above the 50-day MA of 1.54, and below the 200-day MA of 2.18, indicating a bearish trend. The MACD of -0.49 indicates Negative momentum. The RSI at 15.99 is Positive, neither overbought nor oversold. The STOCH value of 25.88 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for MHGUQ.
Meritage Hospitality Group Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
70 Outperform | $32.69M | 11.36 | 17.95% | ― | 7.23% | 8.40% | |
67 Neutral | $86.97M | 13.11 | 9.84% | 1.28% | 6.14% | 53.60% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
47 Neutral | $47.53M | -0.39 | -69.17% | ― | -4.06% | -154.36% | |
46 Neutral | $84.85M | -3.55 | 50.91% | ― | 0.19% | 46.85% | |
39 Underperform | $364.28K | >-0.01 | -54.72% | 1.23% | -12.04% | -8862.22% |
* Consumer Cyclical Sector Average
MHGUQ
Meritage Hospitality Group
0.06
-9.29
-99.36%
BDL
Flanigan's Enterprises
48.20
17.35
56.26%
RAVE
Rave Restaurant Group
2.25
-0.52
-18.77%
NDLS
Noodles & Co
14.20
9.03
174.77%
STKS
The ONE Group Hospitality
1.54
-1.02
-39.84%
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.