Carrols: 200%+ Upside, Catalyst-Driven 'Endless' Growth Opportunity, Top-Tier Management
- As TAST normalizes margins from the 2012 acquisition, finishes the 20/20 remodel and executes the stated roll-up opportunity acquiring BK stores at 1-3x EBITDA, EBITDA should increase from $40m to $115m+.
- TAST has tremendous operating leverage to increasing sales, due to temporarily high operating expenses from the recent spin-off.
- A $67m capital raise unlocks $20m additional cash, while allowing TAST to refinance the 2015 debt at ~60% lower interest expense, generating 28.6%+ upside from this catalyst alone.
- TAST has world-class management, who own 9% of equity, while the famous 3G Capital Partners took 29% equity stake and 2 board seats at ~$6 per share, with a 30-month lockup.
- My estimates ignore "free option" from a 3G-driven BKW turnaround or valuation multiple expansion. If 3G is successful, a >$30 TAST stock price is not unreasonable.