Core Insights - Advent International has significantly reduced its stake in First Watch Restaurant Group, selling 9,400,000 shares, resulting in a net decrease of approximately $152.89 million as of September 30, 2025 [1][2]. Company Overview - First Watch Restaurant Group operates 548 company-owned and 72 franchised restaurants across 28 U.S. states, focusing on breakfast, brunch, and lunch offerings [5][8]. - The company has a market capitalization of $1.08 billion, with trailing twelve months (TTM) revenue of $1.17 billion and a net income of $5 million [4]. Financial Performance - As of December 5, 2025, First Watch shares were priced at $17.70, reflecting a 10% decline over the past year, underperforming the S&P 500 by 23 percentage points [3]. - The company's five-year compound annual growth rate (CAGR) for sales is 22%, indicating strong growth potential [3]. Investment Position - Following the sale, Advent International's remaining stake in First Watch represents 1.67% of its reported 13F assets, down from 7.64% in the previous quarter [2][3]. - Despite the reduction, Advent still holds a 9% stake in First Watch, highlighting the disparity in size between the two entities [9]. Growth Potential - First Watch has demonstrated impressive growth metrics, with sales increasing by 26% and same-store sales rising by 7% in the last quarter [11]. - The company operates under a unique model where employees work a single shift, enhancing operational efficiency and employee satisfaction [10]. - First Watch's meals are positioned as "affordable luxury," appealing to a younger demographic with customizable options [11][12].

Core Insights - First Watch Restaurant Group reported a same-restaurant sales growth of 7.1% and total revenues increased by 25.6% to $316.0 million for Q3 2025 compared to $251.6 million in the same period of 2024 [1][7] - The company opened 21 new system-wide restaurants across 14 states, bringing the total to 620 restaurants [1][7] - Net income for the quarter was $3.0 million, or $0.05 per diluted share, compared to $2.1 million, or $0.03 per diluted share, in Q3 2024 [1][7] Financial Performance - Adjusted EBITDA for Q3 2025 was $34.1 million, up from $25.6 million in Q3 2024 [1][7] - System-wide sales increased by 20.9% to $352.7 million compared to $291.8 million in the same period of 2024 [7] - Restaurant-level operating profit margin improved to 19.7% from 18.9% in the same period of 2024 [7] Operational Highlights - Same-restaurant traffic growth was recorded at 2.6% [7] - The company plans to guide to the high end of its previous range for FY25 adjusted EBITDA at approximately $123 million [3][6] - Capital expenditures for the fiscal year are projected to be around $150 million, primarily for new restaurant projects and remodels [8] Future Outlook - The company anticipates opening 60 to 61 new system-wide restaurants in FY25, net of closures [8] - The updated guidance for total revenue growth is approximately 20.0%-21.0% for FY25 [8] - The company remains confident in achieving a robust finish to the year with continued aggressive growth [3]