Kirkland Advises Brentwood Associates on Major Investment in Wingstop Franchisee Far West Services
November 10, 2023
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Kirkland, a leading international law firm, has recently advised Brentwood Associates, a private equity firm, on a major growth investment in Far West Services, a Wingstop franchisee. The investment is an important step for Brentwood Associates and Far West Services, as it will further strengthen their partnership and help them expand their business. Wingstop Inc ($NASDAQ:WING). is a restaurant chain specializing in cooked-to-order chicken wings in the United States and around the world. The company has grown to become one of the top fifty restaurant brands in the United States, according to Technomic Inc. The company’s products are offered through company-owned and franchised restaurants. The investment will allow Far West Services to expand its business and continue to be a reliable partner to Wingstop Inc. Both Brentwood Associates and Far West Services are optimistic about their future prospects and are grateful for the advice of Kirkland.
Market Price
Despite the investment, WINGSTOP INC‘s stock opened at $207.6 and closed at $206.2, down by 0.7% from the previous closing price of 207.6. Despite the lower closing price, analysts remain confident in the long-term outlook of WINGSTOP INC as the company continues to expand its presence in the restaurant industry. Kirkland & Ellis LLP’s team was led by partner Robert Jones and included associates Rigby Alger, Alex Miller, and Nick White. The team provided legal counsel on the transaction for Brentwood Associates. Live Quote…
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Wingstop Inc. More…
| Total Revenues | Net Income | Net Margin |
| 437.87 | 68.96 | 15.8% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Wingstop Inc. More…
| Operations | Investing | Financing |
| 106.83 | -45.55 | -155.19 |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Wingstop Inc. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 351.68 | 827.12 | -16.16 |
Key Ratios Snapshot
Some of the financial key ratios for Wingstop Inc are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 22.4% | 25.5% | 25.4% |
| FCF Margin | ROE | ROA |
| 16.8% | -16.6% | 19.8% |
Analysis
GoodWhale conducted an analysis of WINGSTOP INC‘s wellbeing and scored it an 8/10, indicating strong performance in dividend, growth, and profitability. However, it was weaker in asset. The Star Chart demonstrated that WINGSTOP INC was capable of sustaining future operations during times of crisis. Taking its cashflow and debt levels into consideration, WINGSTOP INC received a high health score. Through our analysis, GoodWhale classified WINGSTOP INC as a ‘gorilla’, a type of company that has achieved stable and high revenue or earning growth due to its strong competitive advantage. Therefore, we believe investors that value consistent returns and competitive advantages may be interested in investing in WINGSTOP INC. More…
Peers
The competition in the quick-service restaurant industry is heating up. Wingstop Inc, a leading player in the chicken wing segment, is facing increased competition from Wowprime Corp, Various Eateries PLC, and Hostmore PLC. These companies are all vying for a share of the quick-service restaurant market and are each employing different strategies to gain an edge over their competitors. Wingstop Inc is well-positioned to compete against these rivals and maintain its position as a leading player in the industry.
– Wowprime Corp ($TWSE:2727)
Wiprime Corp, a 9.14B market cap company as of 2022, is a holding company with a -1.91% ROE. The company invests in a range of businesses including healthcare, education, and technology.
– Various Eateries PLC ($LSE:VARE)
Eateries PLC has a market cap of 34.27M as of 2022. The company has a Return on Equity of -5.88%. Eateries PLC is a restaurant company that operates in the United Kingdom.
– Hostmore PLC ($LSE:MORE)
Hostmore PLC is a U.K.-based holding company engaged in the operation of hotels. As of 2022, the company had a market capitalization of 22.07 million pounds and a return on equity of 2.42%. The company operates a portfolio of hotels in the United Kingdom, Spain, and Portugal.
Summary
Wingstop Inc., a fast-casual restaurant chain based in Dallas, Texas, has recently seen significant growth in investments due to Kirkland’s partnership with Brentwood Associates. This investment is connected to Far West Services, a franchisee of Wingstop. Far West has reported significant growth in sales and profits in the past year, making it an appealing target for investors.
The investment from Kirkland and Brentwood provides valuable capital that can be used to fuel expansion efforts, increase access to new markets, and further expand the Wingstop brand. The long-term success of the franchisee and of Wingstop will be determined through careful research by these investors into the current market and future trends.
