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MTY Food Group (OTCPK:MTYFF) (TSX:MTY:CA) just released its Q2 2025 report and the shares are dropping by 12% as of this writing.
It almost feels like a déjà vu, as the stock also declined by
MTY Food Group's Q2 Dip Is Noise, The Franchise Engine Keeps Delivering
Summary
- MTY Food Group shares dropped 12% post-Q2 2025 report, but I view the reaction as overdone, similar to the Q4 2024 decline.
- Despite a flat store count, I see this as a positive, given MTY's history of net closures and ongoing portfolio optimization. FCF/share is consistently higher.
- MTY remains highly cash-generative, trading at just 7x P/FCF, with a resilient, asset-light business model that supports long-term value.
- I am taking advantage of the volatility to add to my position, as MTY now represents 6.89% of my concentrated value portfolio.
Philipp is a seasoned value investor with nearly 20 years of experience in the field. He takes a global approach to investment opportunities, seeking out undervalued companies that offer a significant margin of safety, leading to attractive dividend yields and returns. While he does not limit his investments to specific sectors or countries, he focuses only on companies he thoroughly understands and can reasonably assess for future growth potential. Philipp is particularly enthusiastic when he identifies a company with a solid earnings track record trading at less than 8x free cash flow, which inspired his username: 8xfreecash.
Analyst’s Disclosure:I/we have a beneficial long position in the shares of MTY:CA either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
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