Driven Brands (NASDAQ:DRVN) Issues Quarterly Earnings Results, Beats Expectations By $0.05 EPS

Driven Brands (NASDAQ:DRVN) released its earnings results on Thursday. The company reported $0.30 EPS for the quarter, beating the consensus estimate of $0.25 by $0.05, FiscalAI reports. Driven Brands had a net margin of 9.08% and a return on equity of 25.94%. The business had revenue of $484.44 million during the quarter, compared to analyst estimates of $480.84 million. During the same period in the prior year, the business earned $0.27 earnings per share. The business’s quarterly revenue was down 6.2% on a year-over-year basis.

Here are the key takeaways from Driven Brands’ conference call:

• Driven Brands said Q1 was a solid quarter, with system-wide sales up 6%, revenue up 8%, same-store sales up 2%, and adjusted EBITDA up 2% while margins held at 21.5%.
• Take 5 Oil Change remained the growth engine, posting its 23rd consecutive quarter of same-store sales growth and delivering 4.5% comp growth, 14% system-wide sales growth, and 33.9% adjusted EBITDA margins.
• The company reiterated its full-year 2026 guidance, including revenue of $1.95 billion to $2.05 billion, adjusted EBITDA of $430 million to $460 million, and 160 to 190 net new units.
• Management remains focused on reducing net leverage, which ended Q1 at 3.2x, and said it is still on track to reach its 3x target by year-end.
• Executives flagged moderation in traffic from newer and more value-oriented Take 5 customers, especially lower-income households, and said they expect some softness in Q2 and in Franchise Brands later this year.

Driven Brands Stock Down 2.9%

DRVN stock opened at $13.43 on Friday. Driven Brands has a 12-month low of $9.80 and a 12-month high of $19.74. The company has a quick ratio of 0.67, a current ratio of 0.75 and a debt-to-equity ratio of 2.45. The company has a market cap of $2.22 billion, a price-to-earnings ratio of 11.99 and a beta of 0.97. The company has a 50 day moving average of $13.13 and a two-hundred day moving average of $13.93.

Key Headlines Impacting Driven Brands

Here are the key news stories impacting Driven Brands this week:

• Positive Sentiment: Driven Brands beat Q1 earnings expectations, reporting $0.30 EPS versus the $0.25 consensus and revenue of $484.4 million, which helped support the stock. Earnings Report
• Positive Sentiment: BTIG Research reiterated a buy rating with a $17 price target, signaling confidence in further upside from current levels. BTIG Reiterates Buy
• Positive Sentiment: Royal Bank of Canada also maintained an outperform rating and set a $17 price target, even after lowering its target from $18, implying more room for the shares to rise. RBC Lowers Price Target
• Positive Sentiment: Management highlighted strength in Take 5 Oil Change and system-wide sales growth, with same-store sales up 2% and store count up 5%, supporting the company’s longer-term growth story. Q1 Results Press Release
• Neutral Sentiment: Some analysts and commentators remain cautious, pointing to debt, margin pressure, flat near-term earnings, and a cautious second-quarter outlook, which may limit enthusiasm despite the valuation discount. Seeking Alpha Commentary
• Negative Sentiment: Revenue growth missed the strongest expectations and was down year over year, keeping attention on whether Driven Brands can accelerate top-line momentum while also deleveraging. Zacks Earnings Call Takeaways

Institutional Investors Weigh In On Driven Brands

A number of hedge funds and other institutional investors have recently added to or reduced their stakes in DRVN. Goldman Sachs Group Inc. raised its holdings in shares of Driven Brands by 14.8% during the 4th quarter. Goldman Sachs Group Inc. now owns 3,826,160 shares of the company’s stock valued at $56,704,000 after purchasing an additional 491,919 shares in the last quarter. Boston Partners raised its holdings in shares of Driven Brands by 1,301.0% during the 4th quarter. Boston Partners now owns 3,426,388 shares of the company’s stock valued at $50,783,000 after purchasing an additional 3,181,812 shares in the last quarter. JPMorgan Chase & Co. raised its holdings in shares of Driven Brands by 2.7% during the 4th quarter. JPMorgan Chase & Co. now owns 3,234,369 shares of the company’s stock valued at $47,933,000 after purchasing an additional 86,281 shares in the last quarter. Janus Henderson Group PLC raised its holdings in shares of Driven Brands by 9.3% during the 4th quarter. Janus Henderson Group PLC now owns 2,477,179 shares of the company’s stock valued at $36,712,000 after purchasing an additional 209,883 shares in the last quarter. Finally, Dimensional Fund Advisors LP raised its holdings in shares of Driven Brands by 19.6% during the 4th quarter. Dimensional Fund Advisors LP now owns 2,161,642 shares of the company’s stock valued at $32,038,000 after purchasing an additional 354,540 shares in the last quarter. Hedge funds and other institutional investors own 77.08% of the company’s stock.

Wall Street Analysts Forecast Growth

Several research firms recently commented on DRVN. Royal Bank Of Canada cut their target price on shares of Driven Brands from $18.00 to $17.00 and set an “outperform” rating for the company in a research note on Thursday. Benchmark restated a “buy” rating on shares of Driven Brands in a research report on Tuesday, May 26th. Freedom Capital upgraded shares of Driven Brands to a “strong-buy” rating in a research report on Monday, March 23rd. BMO Capital Markets reduced their price target on shares of Driven Brands from $18.00 to $14.00 and set a “market perform” rating for the company in a research report on Thursday, May 21st. Finally, William Blair downgraded shares of Driven Brands from an “outperform” rating to a “hold” rating in a research report on Wednesday, April 22nd. Two equities research analysts have rated the stock with a Strong Buy rating, five have issued a Buy rating, six have issued a Hold rating and one has given a Sell rating to the company. Based on data from MarketBeat, Driven Brands presently has an average rating of “Moderate Buy” and a consensus price target of $17.18.

About Driven Brands

Driven Brands Holdings Inc (NASDAQ: DRVN) is a leading North American provider of automotive aftermarket services, operating through a network of franchised and company-owned locations. The company’s platform encompasses a diverse portfolio of car care and maintenance brands, including Meineke Car Care Centers, Maaco Collision Repair & Auto Painting, Take 5 Oil Change, and Carstar Collision Repair. Driven Brands delivers a full range of services from routine maintenance and oil changes to collision repair, paint protection, and vehicle customization.

Headquartered in Charlotte, North Carolina, Driven Brands serves both individual consumers and commercial clients across the United States and Canada.