Mister Car Wash upgraded to overweight by JPMorgan while Driven Brands gets cut

By Steve Gelsi

Analyst says 'competitive tide shifting back' in the company's favor

JPMorgan Chase on Friday boosted its rating on Mister Car Wash Inc. and cut its view on rival Driven Brands Holdings Inc. as analysts sifted through the latest results from the two car-service retailers.

Mister Car Wash (MCW) was upgraded to overweight from neutral by JPMorgan analyst Christian Carlino, who said the competitive tide is shifting back to the company's favor as unit growth at its peers slows down. He kept the stock's price target at $8.50 a share.

Carlino said Mister Car Wash offers visibility to comparable store improvement due to the popularity of its full-price Titanium car wash offering. It's also winning customers from other auto-service retailers.

Mister Car Wash's stock is also trading at a discount to other stocks of companies in the auto-service business, he said.

Mister Car Wash's stock was up by 3.3% in premarket trades.

Driven Brands (DRVN) was downgraded to neutral from overweight, with a price target cut to $12.50 a share from $18 a share due to "limited visibility to material improvement in the Car Wash and Glass businesses" as well as a "more cautious" outlook from management.

The departure of the company's financial chief is also an "overhang on sentiment" for the company, Carlino said.

Driven Brands' stock was down by 3.3% in premarket trades.

Also read: Mister Car Wash stock falls in first earnings report since IPO

-Steve Gelsi

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05-03-24 0850ET

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