European Wax Center (EWCZ) PT Raised to $6 at Citi

Citi analyst Kelly Crago raised the price target on European Wax Center (NASDAQ: EWCZ) to $6.00 (from $4.50) while maintaining a Neutral rating.

The analyst comments "1Q was better than cons driven by slightly stronger sales. System-wide comps of +0.7% were above cons (flat) and reflect stabilization in the business relative to 4Q, despite macro concerns. New leadership is doing what they can to reignite comp growth and get better visibility into franchise-level store profitability, including retooling their marketing efforts to bring new custs into centers. Results in 1Q show signs that mgmt’s efforts have at least stabilized the topline and mgmt’s reiteration of F25 sales/EBITDA/store guidance suggests some visibility into franchisee health. And mgmt pointed to the end of F26 for when they expect to return to net store growth. The high-end of F25 guidance implies a trend improvement in 2H driven by new initiatives, however visibility remains low. We expect shares to remain rangebound until mgmt can prove their strategy will drive improved comp store performance, suggesting a balanced risk/reward at current levels."

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