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Regis Corp (RGS)
NASDAQ:RGS
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Regis
(NASDAQ:RGS)
63Neutral
Regis (RGS) vs. S&P 500 (SPY)
Market Cap
$45.02M
Dividend YieldN/A
Average Volume (3M)10.89K
Price to Earnings (P/E)0.5
Beta (1Y)0.75
Revenue Growth-11.38%
EPS GrowthN/A
CountryUS
Employees1,945
SectorConsumer Cyclical
Sector Strength60
IndustryPersonal Products & Services
Share Statistics
EPS (TTM)0.61
Shares Outstanding2,435,979
10 Day Avg. Volume7,467
30 Day Avg. Volume10,895
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)0.00
Price to Cash Flow (P/CF)0.00
P/FCF Ratio0.00
Enterprise Value/Market Cap9.38
Enterprise Value/RevenueN/A
Enterprise Value/Gross Profit4.15
Enterprise Value/EbitdaN/A
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
Regis Business Overview & Revenue Model
Company DescriptionRegis Corporation owns, operates, and franchises hairstyling and hair care salons in the United States, Canada, Puerto Rico, and the United Kingdom. The company operates in two segments, Franchise Salons and Company-Owned Salons. Its salons provide haircutting and styling, including shampooing and conditioning; hair coloring; and other services, as well as sells various hair care and other beauty products. The company also offers mobile applications; and operates accredited cosmetology schools. Regis Corporation operates its salons primarily under the SmartStyle, Supercuts, Cost Cutters, Roosters, First Choice Haircutters, and Magicuts concepts names. As of June 30, 2022, the company operated 5,576 salons, such as 5,395 franchised salons, 105 company-owned salons, and 76 non-controlling ownership salons. Regis Corporation was founded in 1922 and is headquartered in Minneapolis, Minnesota.
How the Company Makes MoneyRegis Corporation primarily generates revenue through the operation and franchising of hair salons. The company's income is derived from two main sources: the direct operation of company-owned salons and the collection of franchise fees and royalties from independently owned franchises. Revenue from company-owned salons comes from the provision of haircuts, coloring, styling services, and the sale of hair care products. Franchise revenue involves initial franchise fees paid by franchisees to use Regis' brands, as well as ongoing royalties based on a percentage of the franchisees' sales. Regis also benefits from strategic partnerships with product manufacturers and distributors, enhancing its product offerings and contributing to its revenue streams.
Regis Financial Statement Overview
Summary
Regis shows commendable profitability improvements and a recovery in cash flows. However, declining revenues from $415.1M in 2021 to $191.3M in TTM and high leverage with a debt-to-equity ratio of 4.16 pose ongoing financial challenges.Income Statement
Regis has demonstrated significant improvements in profitability over recent periods, with a strong TTM net profit margin of 50.0% and a positive EBIT margin of 8.5% in TTM, indicating effective cost management and operational efficiency. However, the company has experienced a declining revenue trend from $415.1M in 2021 to $191.3M in TTM, which poses a challenge for sustaining long-term growth.―
Balance Sheet
The balance sheet reflects high leverage with a debt-to-equity ratio of 4.16 in TTM, showing significant reliance on debt financing. Stockholders' equity remains low at $66.7M as of TTM, although improved from prior negative equity positions. The equity ratio of 12.6% in TTM indicates limited asset backing, which could be a risk if financial conditions worsen.40
Cash Flow
Regis has improved its cash flow position, turning to positive free cash flow of $5.1M in TTM from previous negative figures. The operating cash flow to net income ratio of 0.06 in TTM suggests that while positive, operating cash flows are not yet robust. Free cash flow growth is significant, but sustainability remains a concern given past volatility.―
| Breakdown | ||||
| Jun 2024 | Jun 2023 | Jun 2022 | Jun 2021 | Jun 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 202.98M | 233.33M | 275.97M | 415.11M | 669.73M | Gross Profit |
| 101.76M | 76.54M | 65.62M | 129.41M | 235.55M | EBIT |
| 20.89M | 8.78M | -15.24M | -91.13M | -80.28M | EBITDA |
| 68.74M | 17.30M | -22.67M | -81.44M | -108.39M | Net Income Common Stockholders |
| 91.06M | -7.38M | -46.46M | -113.33M | -172.19M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 10.07M | 9.51M | 17.04M | 19.19M | 113.67M | Total Assets |
| 530.50M | 607.38M | 769.30M | 996.38M | 1.34B | Total Debt |
| 399.28M | 550.65M | 691.63M | 822.25M | 1.02B | Net Debt |
| 389.21M | 541.14M | 674.59M | 803.06M | 909.54M | Total Liabilities |
| 473.71M | 644.11M | 800.25M | 979.34M | 1.22B | Stockholders Equity |
| 56.79M | -36.73M | -30.95M | 17.05M | 125.70M |
| Cash Flow | Free Cash Flow | |||
| -2.42M | -8.37M | -43.95M | -111.36M | -123.90M | Operating Cash Flow |
| -2.04M | -7.89M | -38.64M | -99.88M | -86.41M | Investing Cash Flow |
| 1.62M | 4.02M | 7.68M | -2.10M | 61.03M | Financing Cash Flow |
| 8.36M | -2.15M | 29.42M | 7.78M | 56.16M |
Regis Technical Analysis
Positive
19.11
Price Trends
18.33
Positive
21.02
Negative
22.41
Negative
Market Momentum
0.19
Negative
55.03
Neutral
62.90
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RGS, the sentiment is Positive. The current price of 19.11 is above the 20-day moving average (MA) of 17.96, above the 50-day MA of 18.33, and below the 200-day MA of 22.41, indicating a neutral trend. The MACD of 0.19 indicates Negative momentum. The RSI at 55.03 is Neutral, neither overbought nor oversold. The STOCH value of 62.90 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for RGS.
Regis Risk Analysis
Regis disclosed 31 risk factors in its most recent earnings report. Regis reported the most risks in the “Ability to Sell” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Regis Peers Comparison
Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
63 Neutral | $45.02M | 0.51 | 526.88% | ― | -11.38% | ― | |
61 Neutral | $6.66B | 11.77 | 3.06% | 3.96% | 2.60% | -21.54% | |
56 Neutral | $142.99M | 66.49 | -3.32% | ― | -39.47% | -110.28% | |
44 Neutral | $4.32M | ― | -275.96% | ― | 12.58% | 47.24% | |
41 Neutral | $63.41M | ― | 31.02% | ― | -10.33% | 79.59% | |
38 Underperform | $6.20M | 4.66 | 23.48% | ― | -7.60% | -118.80% | |
27 Underperform | $5.64M | ― | -4470.12% | ― | 459.36% | 70.21% |
* Consumer Cyclical Sector Average
Performance Comparison
RGS
Regis
19.11
12.51
189.55%
MED
Medifast
12.75
-12.24
-48.98%
XWEL
XWELL
0.86
-0.96
-52.75%
WW
WW International
0.37
-1.62
-81.41%
MRM
MEDIROM Healthcare Technologies
0.82
-4.68
-85.09%
TRNR
Interactive Strength Inc
0.68
-639.32
-99.89%
Regis Earnings Call Summary
Earnings Call Date:Feb 12, 2025
(Q2-2025)
| % Change Since: -28.67%|
Next Earnings Date:May 13, 2025
Earnings Call Sentiment Neutral
The earnings call highlighted significant strategic initiatives, such as the acquisition of Alline Salon Group and the successful launch of the Supercuts loyalty program, leading to improved financial metrics. However, challenges like same-store sales decline and brand-specific performance issues balanced the narrative, indicating a cautiously optimistic outlook.Q2-2025 Updates
Positive Updates
Acquisition of Alline Salon Group
Regis acquired the Alline Salon Group, adding 314 salons to the company, enhancing strategic and financial positioning, and expected to drive future growth.
Improved Financial Performance
Year-over-year improvements in operating income, net income, earnings per share, adjusted EBITDA, and cash flow. Adjusted EBITDA increased by 12.7% to $7.1 million, and earnings per share rose to $2.71.
Successful Launch of Supercuts Loyalty Program
Supercuts Rewards program launched with 27% of sales via members and improved same-store sales and traffic by 200 basis points for salons with high membership adoption.
Positive Cash Flow Generation
Regis returned to generating positive cash from operations, reflecting a $7.6 million improvement over the prior year for the six-month period.
Negative Updates
Same-Store Sales Decline
Same-store sales declined by 1.6% in the second quarter, affected by a smaller window between Thanksgiving and Christmas and brand-specific disparities.
SmartStyle Brand Performance
SmartStyle brand underperformed with a 6.4% decline in sales, attributed to closures and remodels within Walmart.
Revenue Decline
Total second quarter revenues were $46.7 million, an 8.5% decline compared to the prior year, driven by franchise closures and a challenging sales environment.
Impact of Store Closures
Store closures had a 130 basis points drag on overall comps for the second quarter, affecting same-store sales performance.
Company Guidance
During the second quarter of fiscal year 2025, Regis made notable strides in both strategic acquisitions and financial performance. The acquisition of the Alline Salon Group, consisting of 314 salons, significantly bolstered Regis's portfolio, enhancing their strategic position and contributing $2.7 million in revenue and $0.5 million in EBITDA within just two weeks post-acquisition. This acquisition was valued at $22 million, with $19 million paid in cash and approximately 140,000 shares of stock. Financially, Regis reported a 12.7% year-over-year increase in adjusted EBITDA, totaling $7.1 million, despite an 8.5% decline in total revenue to $46.7 million. The decline was primarily attributed to a decrease in no-margin franchise rental income and same-store sales, which fell by 1.6%. However, the company's same-store sales showed disparity among brands, with Supercuts experiencing a slight growth of 0.5%, whereas SmartStyle saw a decline of 6.4%. Earnings per diluted share were $2.71, although adjusted earnings per share were $0.61 due to one-time income from discontinued operations. The strategic focus remains on optimizing brand strategy and salon operations, with initiatives like the Supercuts loyalty program showing promising results, achieving 27% of sales through membership and boosting same-store sales and traffic by 200 basis points in high-participation salons. Looking forward, Regis is committed to driving growth through a mix of corporate and franchise salons, with key strategic initiatives aimed at improving salon-level performance and digital guest experiences.Regis Corporate Events
M&A TransactionsBusiness Operations and Strategy
Regis Corporation Expands with Strategic Acquisition of Alline
Positive
Dec 19, 2024
Regis Corporation has acquired Alline Salon Group, its largest franchisee, for $22 million in cash and stock, with potential additional earn-out payments. The acquisition strengthens Regis’ operational footprint and provides a testing ground for brand initiatives, maintaining an asset-light model with most salons still franchisee-owned. This strategic move is expected to enhance Regis’ EBITDA and provide value creation opportunities, aligning stakeholder interests towards success.
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.