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what it is
First Watch runs 572 breakfast, brunch, and lunch restaurants across 29 states.
how it gets paid
Last year First Watch made $1.2B in revenue. Breakfast items was the main engine at $0.44B, or 37% of sales.
why it's growing
Revenue grew 20.3% last year. Revenue was up 187% vs. prior year, helped by a larger store base and strong daytime traffic.
what just happened
Revenue hit $906M and EPS came in at $0.07.
At a glance
C++ balance sheet — some cracks in the foundation
107.5x trailing p/e — you're paying up for this one
3.2% return on capital — nothing to write home about
$0.30 fy2024 eps est
$1B fy2024 rev est
xvary composite: 41/100 — below average
What they do
First Watch runs 572 breakfast, brunch, and lunch restaurants across 29 states.
First Watch uses one daytime shift, so you are not paying for a dinner service it never opens. That makes each restaurant average $2.2M in annual sales. The split is 489 company-owned restaurants versus 83 franchise-owned ones. That is 572 sites turning one meal window into a national habit.
How they make money
$1.2B
annual revenue · their business grew +20.3% last year
Breakfast items
$0.44B
+19.8%
Brunch items
$0.35B
+20.4%
Lunch items
$0.33B
+18.9%
Franchise and other revenue
$0.08B
+24.0%
The products that matter
operates daytime dining restaurants
First Watch restaurants
$1.2B · 537 system-wide locations
This is the business. It generated $1.2B in 2025 revenue across 537 restaurants, so your bet is still mostly on opening more stores and keeping traffic steady at the existing ones.
unit growth story
sells franchises and collects fees
franchise revenue
$100M · about 8% of revenue
This is the lighter part of the model. The catch is scale. At about 8% of revenue, it is still too small to change the company from restaurant operator to fee collector.
smaller profit lever
new restaurant openings
new unit pipeline
64 opened in 2025 · 59–63 targeted next
The company opened a record 64 restaurants in 2025 and plans 59–63 more in 2026. That's the growth engine. It's also the part of the story that has to stay clean when same-store sales are only guided to 1–3%.
the number to watch
Key numbers
$1.2B
annual revenue
That is the money pile. Compare it with $896M of debt and you see why leverage matters.
107.5x
price vs. earnings
You are paying $107.50 for each $1 of trailing profit.
$896M
debt load
Debt equals 56% of capital, so rate changes hit a chain that already owes real money.
572
restaurant count
This is the footprint behind the sales base and the reason one shift model scales.
Financial health
C++
strength
- balance sheet grade C++ — below average — limited financial resources
- risk rank 3 — safer than 50% of stocks
- price stability 25 / 100
- long-term debt $896M (56% of capital)
C++ — balance sheet grade and long-term debt are flagged. this stock carries more risk than average.
Total return vs. market
Return history isn't available for FWRG right now.
source: institutional data · return history unavailable
What just happened
beat estimates
Revenue hit $906M and EPS came in at $0.07.
Revenue was up 187% vs. prior year, helped by a larger store base and strong daytime traffic. still has FY2024 EPS at $0.30, which tells you earnings are thin for the valuation.
$300M
revenue
$0.07
eps
9.9%
operating margin
the number that mattered
Revenue mattered most because $906M in a quarter makes a 572-unit chain look bigger than the market may expect.
source: company earnings report, 2026
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What could go wrong
First Watch's problem is specific: the stock still asks you to pay for a polished rollout while the operating evidence is getting less polished.
high
premium multiple, ordinary returns
The stock trades at 107.5x trailing earnings and 55.9x forward 2026 p/e, while return on capital is 3.2%.
If the growth narrative slips, the multiple has a long way to compress before it looks ordinary.
high
same-store sales are losing altitude
Management cut 2026 same-store sales guidance to 1–3% from 3.6%.
New restaurants can cover some of that for a while. They cannot make the underlying slowdown disappear.
med
debt makes the story less forgiving
Long-term debt sits at $896M, or 56% of capital, with a C++ balance sheet grade.
That matters more because 92% of revenue still comes from company-owned restaurants, where operating hiccups hit you directly.
med
leadership change during a heavy build cycle
CFO Mel Hope announced retirement on feb 24, 2026, while the company still plans 59–63 new locations.
Not fatal on its own. Still, you would rather not add finance leadership turnover when the market is already rechecking the growth assumptions.
What would change our mind: same-store sales moving back above 3.6% while the 59–63 planned openings land cleanly. That would tell you the slowdown was a pause, not the story.
source: institutional data · regulatory filings · risk analysis
Pay attention to
trend
same-store sales
Management now expects 1–3% same-store sales growth in 2026, down from 3.6%. If that slips again, the premium multiple gets harder to defend.
metric
unit growth pace
The company opened 64 restaurants in 2025 and targets 59–63 more in 2026. This is the expansion engine the stock is being valued on.
risk
debt load
$896M of long-term debt equals 56% of capital. If restaurant-level performance softens, leverage stops being a footnote.
calendar
investor conference follow-through
The Raymond James conference on march 3, 2026 gives management a chance to explain how 59–63 openings and softer same-store sales fit together.
Analyst rankings
valuation read
stretched
107.5x trailing earnings and 55.9x forward 2026 p/e. in human-speak: the market is already assuming the rollout stays smooth.
balance sheet read
below average
C++ balance sheet grade with $896M in long-term debt. You are not buying a clean balance sheet story here.
data quality note
thin
Coverage in the current snapshot is limited, so the usable signal is mostly in valuation, guidance changes, debt, and store openings.
source: institutional data
Institutional activity
institutional ownership data for FWRG is being compiled.
source: institutional data
Price targets
3-5 year target range
n/a
n/a
$16
current price
n/a
target midpoint · n/a from current
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