First Watch Restaurant Group, I — Earnings Quality Grade F
FWRG · Consumer Cyclical
Major red flags
Screening Summary
Management Signals
Financial Trends
Revenue & Net Income ($B)
Margins (%)
18-Point Screening
Revenue Quality
DSO 1 days, change +0 days YoY
AR growth 22.3% vs revenue growth 20.3%
Revenue 20.3%, CFFO 8.9%. Cash follows revenue
Expense Quality
Inventory 17.3% vs COGS 23.1%. Normal
CapEx growth 23.2% vs revenue 20.3%. Normal
SG&A/Gross Profit = 55.0%. Normal
Gross margin 19.2%, change -1.8pp. Stable
Cash Flow Quality
CFFO/NI = 6.48. Profits backed by cash
FCF < 50% of Net Income for 3 years
Accruals ratio = -6.1%. Low accruals
Cash $0.0B covers only 2% of debt $1.0B
Balance Sheet Health
Goodwill+Intangibles $0.6B = 95% of equity. Over 50%
Debt/EBITDA = 9.7x (>4x). Interest coverage = 1.8x (<2x). Financial stress
Other assets grew 48.7% vs revenue 20.3%
No write-off data
Acquisition Risk
FCF after acquisitions negative for 3 years
Small-cap context: A single acquisition on a small balance sheet can trip serial-acquirer logic.
Goodwill+Intangibles change 5% YoY. Normal
Manipulation Score
M-Score = -2.60 (< -2.22). Unlikely manipulator
Portfolio monitoring
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Beneish M-Score
Altman Z-Score
Generated from public financial data using forensic accounting frameworks. Not investment advice. Data: Yahoo Finance · 2026-04-25