Wrote an [article](https://gregw134.substack.com/p/first-watch-fwrg-why-cracker-barrel?r=23iup&utm_campaign=post-expanded-share&utm_medium=web) on First Watch ($FWRG). I would post directly here but pictures aren't allowed. The company is Starbucksifying breakfast, it's competing on quality and style where Denny's/IHOP/Waffle House compete on price. Very popular in the Midwest and South and expanding nationally, currently at 650 restaurants with a target of 2200.
On the surface it looks like a pe 40 stock but once you dig into the numbers it's closer to 10x while growing 10-12% a year. The restaurants do 18-20% margins which is fantastic for sit-down restaurants. I [modeled](https://gregw135.github.io/fwrg-model/) out the business, and if the current restaurant economics hold the stock should do 25% a year for the next 10 years. Looks mispriced to me for several reasons which I discuss in the article. First Watch is about to do an investor relations tour with two presentations in September and investor day in November where they're going to go over their growth formula and key business metrics. Hopefully that will be a catalyst for the stock to rerate, but if it doesn't it's a growing business at a cheap price that I'm happy holding for a couple years.
