Winmark Corporation (WINA)

Winmark Corporation (WINA) Consumer Business Overview

Winmark Corporation franchises retail stores specializing in buying, selling, and trading used merchandise across various categories like clothing, sporting goods, and musical instruments. Operating primarily in the US and Canada, Winmark leverages a franchise model and equipment leasing to serve value-conscious consumers and small to medium-sized businesses.

What Is the Investment Thesis for WINA?

Winmark Corporation presents a compelling investment case due to its robust franchise model and focus on the resilient resale market. The company's high gross margin of 96.7% and profit margin of 48.2% demonstrate efficient operations and strong profitability. With a dividend yield of 3.75%, Winmark offers an attractive income stream. Growth catalysts include expanding the franchise network and increasing online sales. A potential risk is the dependence on franchisee performance and consumer spending habits. The company's beta of 0.67 suggests lower volatility compared to the broader market, making it a potentially stable investment.

Based on FMP financials and quantitative analysis

WINA Key Highlights

• Market capitalization of $1.48B, reflecting investor confidence in Winmark's business model and growth potential.
• P/E ratio of 32.57, indicating the price investors are willing to pay for each dollar of Winmark's earnings.
• Gross margin of 96.7%, showcasing the company's ability to efficiently manage its cost of goods sold.
• Profit margin of 48.2%, highlighting Winmark's operational efficiency and profitability.
• Dividend yield of 3.75%, providing investors with a steady income stream and demonstrating the company's commitment to returning value to shareholders.

Who Are WINA's Competitors?

WINA is benchmarked below against 8 industry peers on price, market cap, and our AI MoonshotScore.

AI Score by Stock Expert AI · Price data: FMP / Yahoo Finance

What Are WINA's Key Strengths?

• Established brand names with strong customer recognition.
• Proven franchise model with recurring revenue streams.
• Focus on the growing resale market.
• Diversified business model with franchising and leasing segments.

What Are WINA's Weaknesses?

• Dependence on franchisee performance.
• Exposure to consumer spending habits and economic conditions.
• Potential for brand dilution if franchisees do not adhere to standards.
• Limited geographic diversification, primarily focused on the US and Canada.

What Could Drive WINA Stock Higher?

• Expansion of the franchise network, increasing the number of Plato's Closet, Once Upon A Child, Play It Again Sports, Style Encore, and Music Go Round stores.
• Enhancement of online sales platforms to drive e-commerce revenue.
• Strategic partnerships to expand market reach and brand awareness.
• Potential acquisitions of complementary businesses to diversify revenue streams.

What Are the Key Risks for WINA?

• Economic downturns that reduce consumer spending on discretionary items.
• Increased competition from other resale stores and online marketplaces.
• Changes in consumer preferences and fashion trends.
• Dependence on franchisee performance and adherence to brand standards.
• Fluctuations in the market for technology and business-essential equipment leasing.

What Are the Growth Opportunities for WINA?

• Expansion of Franchise Network: Winmark has the opportunity to expand its franchise network both domestically and internationally. The market for resale clothing and sporting goods is growing, driven by increased consumer interest in sustainability and value. By strategically opening new franchise locations in underserved markets, Winmark can increase its revenue and market share. This expansion can be achieved through targeted marketing campaigns and incentives for new franchisees. The timeline for this growth is ongoing, with a focus on adding a specific number of new stores each year.
• Enhancement of Online Presence: Winmark can further enhance its online presence through its existing websites, musicgoround.com, playitagainsports.com, and style-encore.com. The e-commerce market is rapidly growing, and by improving the user experience, expanding product offerings, and implementing targeted digital marketing strategies, Winmark can attract more online customers. This includes investing in better website design, search engine optimization (SEO), and social media marketing. The timeline for this growth is immediate, with continuous improvements and updates to the online platforms.
• Leveraging Data Analytics: Winmark can leverage data analytics to better understand customer preferences and trends. By analyzing sales data, customer demographics, and market trends, Winmark can make more informed decisions about product offerings, marketing strategies, and store locations. This includes investing in data analytics tools and hiring data scientists to extract valuable insights from the company's data. The timeline for this growth is ongoing, with continuous data analysis and refinement of strategies.
• Strategic Partnerships: Winmark can form strategic partnerships with other companies in the retail and technology sectors. This could include partnerships with e-commerce platforms, social media influencers, or sustainable fashion brands. By collaborating with these partners, Winmark can reach new customers, expand its product offerings, and enhance its brand image. The timeline for this growth is medium-term, with a focus on identifying and establishing partnerships over the next 1-2 years.
• Equipment Leasing Expansion: Winmark's leasing segment offers a growth opportunity by expanding its focus on technology and business-essential equipment. The demand for equipment leasing is growing, as businesses seek flexible financing options. By targeting specific industries and offering customized leasing solutions, Winmark can increase its leasing revenue and market share. This includes investing in sales and marketing efforts to reach potential leasing customers. The timeline for this growth is medium-term, with a focus on expanding the leasing portfolio over the next 2-3 years.

What Opportunities Does WINA Have?

• Expansion into new geographic markets.
• Enhancement of online presence and e-commerce capabilities.
• Strategic partnerships with complementary businesses.
• Increased focus on sustainable and eco-friendly practices.

What Threats Does WINA Face?

• Increased competition from other resale stores and online marketplaces.
• Changes in consumer preferences and fashion trends.
• Economic downturns that reduce consumer spending.
• Regulatory changes that impact the franchise industry.

What Are WINA's Competitive Advantages?

• Brand Recognition: Winmark's established brand names (Plato's Closet, Once Upon A Child, etc.) provide a competitive advantage.
• Franchise Model: The franchise model allows for rapid expansion with limited capital investment.
• Resale Focus: The focus on resale provides a sustainable and resilient business model.
• Equipment Leasing: Diversification into equipment leasing provides a stable revenue stream.

What Does WINA Do?

Winmark Corporation, established in 1988 and headquartered in Minneapolis, Minnesota, operates as a franchisor of retail store concepts focused on the buying, selling, trading, and consignment of used merchandise. The company's business is divided into two segments: Franchising and Leasing. The Franchising segment includes retail stores operating under the brand names Plato's Closet, Once Upon A Child, Play It Again Sports, Style Encore, and Music Go Round. Plato's Closet focuses on used clothing and accessories for teenagers and young adults. Once Upon A Child caters to parents of children ages infant to 12, offering used and new clothing, toys, furniture, equipment, and accessories. Play It Again Sports deals in used and new sporting goods, equipment, and accessories. Style Encore buys and sells used women's apparel, shoes, and accessories. Music Go Round specializes in used and new musical instruments and related accessories. As of February 23, 2022, Winmark had 1,271 franchised stores. The Leasing segment is involved in middle-market equipment leasing, focusing on technology and business-essential equipment. Winmark also offers its products online through websites like musicgoround.com, playitagainsports.com, and style-encore.com, extending its reach beyond physical stores.

What Products and Services Does WINA Offer?

• Franchise retail stores that buy, sell, trade, and consign used merchandise.
• Operate through the Plato's Closet brand, focusing on used clothing and accessories for teenagers and young adults.
• Operate through the Once Upon A Child brand, catering to parents with used and new children's items.
• Operate through the Play It Again Sports brand, dealing in used and new sporting goods and equipment.
• Operate through the Style Encore brand, buying and selling used women's apparel and accessories.
• Operate through the Music Go Round brand, specializing in used and new musical instruments and accessories.
• Engage in middle-market equipment leasing, focusing on technology and business-essential equipment.
• Offer products online through musicgoround.com, playitagainsports.com, and style-encore.com.

How Does WINA Make Money?

• Franchising: Winmark generates revenue by franchising its retail store concepts, collecting franchise fees and royalties.
• Resale: The franchised stores buy, sell, trade, and consign used merchandise, creating a circular economy.
• Equipment Leasing: Winmark's leasing segment provides financing solutions for businesses acquiring technology and equipment.

What Industry Does WINA Operate In?

Winmark Corporation operates within the apparel, footwear, and accessories industry, specifically focusing on the resale and franchise market. The resale market is experiencing growth due to increased consumer awareness of sustainability and value. The competitive landscape includes both franchised and independent resale stores. Winmark differentiates itself through its established brand names and franchise support system. The overall apparel and accessories market is influenced by fashion trends, economic conditions, and consumer spending habits.

Who Are WINA's Key Customers?

• Value-conscious consumers looking for affordable clothing, sporting goods, and musical instruments.
• Parents seeking affordable children's clothing, toys, and equipment.
• Teenagers and young adults interested in trendy and affordable clothing and accessories.
• Businesses in need of financing for technology and business-essential equipment.

P/E 37.0Key Financial Metrics

WINA trades at a trailing price-to-earnings ratio of 37.03, roughly in line with the Consumer Cyclical sector average of ~41x. Its free cash flow yield is 2.7%, a gauge of the cash the business throws off relative to its market value. A current ratio of 1.41 indicates the company holds enough short-term assets to cover its near-term obligations. Its earnings yield is 2.7%, the inverse of the P/E and a quick read on earnings relative to price.

How Winmark Corporation Is Valued

Winmark Corporation carries a market capitalization of $1.48B, placing it in the small-cap category. Relative to its peer group, WINA's quantitative score of 95/100 is above the peer average of 56/100.

F-Score 6/9Financial Health

Winmark Corporation's Piotroski F-Score is 6/9, a 9-point checklist of profitability, leverage and efficiency — a middling fundamental profile. Its Altman Z-Score of 16.22 places it in the safe zone, indicating low near-term bankruptcy risk.

FY2026 estForward Outlook

Wall Street analysts project Winmark Corporation revenue of about $88.7M for fiscal 2026, with EPS near $11.88.

WINA Financials

WINA Latest News

No recent news available for WINA.

WINA Analyst Consensus

WINA MoonshotScore

What Investors Ask About Winmark Corporation (WINA) — Consumer Cyclical

Disclaimer: This content is for informational purposes only and does not constitute investment advice. Always do your own research and consult a financial advisor.

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