MTY is Food Court Royalty

mty fcf

Ticker: MTY  |  Market: TSX  |  Price: $52.90  |  Yield: 0.94%  |  Cap: $1.1B

MTY Food Group, a Quebec based Canadian franchise group, is food court royalty. Over time, MTY has managed to build a stable of some 70 franchise brands including successful quick service names like Thai Express, Extreme Pita and Mr. Sub. Owning successful quick service concepts is highly lucrative as there is very little sustaining capital required – the upfront cost of building out new stores is burdened by the franchisees.

With excess free cash flow, which jumped 44% in 2017 (see graph above), MTY can continue to focus on acquiring and developing new concepts and attracting new franchise owners. Further, they can also afford a higher dividend, which they just hiked by 30% in January!

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