Driven Brands Holdings Inc. Common Stock (DRVN)

FairStock Score: 50/100 — MIXED

Key Financials

Strengths

• Generates $195 million in annual free cash flow (9.5% yield on market cap)
• Established organization with 10,700 employees providing operational scale

Concerns

• High leverage at 3.47x debt-to-equity increases financial risk and interest expense burden
• Altman Z-Score of 0.2 places it in the financial distress zone—elevated bankruptcy risk

AI Analysis

Driven Brands Holdings Inc. Common Stock is a small-cap consumer cyclical company valued at $2.1 billion. The business generates $2.4 billion in annual revenue with a 2.5% net margin and $195 million in free cash flow. From a quality standpoint, Driven shows solid Piotroski F-Score of 6/9 and distressed Altman Z-Score of 0.2 warrants caution. On valuation, the stock is 1.9% FCF yield. Growth dynamics show revenue growing at 6.6% and profit growth of 507.2%. Our composite FairStock Score of 50/100 reflects mixed fundamentals overall. Investors should weigh the business quality against the current price and their own margin of safety requirements.

Bull Case

Improving fundamentals and sector tailwinds could drive meaningful earnings growth, compressing the effective multiple for patient investors. With $195 million in annual free cash flow (9.5% yield), management has ample capital for buybacks, dividends, or accretive acquisitions.

Bear Case

Elevated leverage at 3.5x D/E means rising interest rates or revenue weakness could strain debt covenants and force asset sales at distressed prices. Regulatory changes, input cost inflation, or demand normalization represent underappreciated risks that could materially impact forward estimates.

Data from SEC filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer