WINA

Winmark stock jumped 5.5% in regular trading to about $314 after its Q3 2026 report, a punchy move for a mature franchisor built on resale chains like Plato's Closet and Once Upon A Child. The headline is simple. Quarterly revenue reached about $27.9 million and basic earnings per share landed near $3.29, both solid on their own terms. Price action reflects how traders feel today. The real story sits in the gap between that upbeat move, a richer P/E multiple, and a balance sheet flagged for high debt and negative equity. Love the earnings pop and franchise economics at Winmark but uneasy about a richer P/E layered on top of a stressed balance sheet? You can filter for retailers with cleaner finances using our list of solid balance sheet and fundamentals stocks (25 results). - Revenue (Q3 2026 vs. Q3 2025): US$27.9m vs. US$22.6m (up about 23%) - Net Income (Q3 2026 vs. Q3 2025): US$11.8m vs. US$11.1m (up about 6%) - Basic EPS (Q3 2026 vs. Q3 2025): US$3.29 vs. US$3.13 (up about 5%) - Net Profit Margin, trailing 12 months (latest vs. prior year): 45.1% vs. 48.8% (margin has compressed) Ask Charlie what Winmark's rich valuation is really pricing in. For the bullish camp, Winmark delivers what a royalty focused franchisor is supposed to deliver. Revenue grew faster than net income, yet basic EPS still edged higher to US$3.29 and net profit margin over the past year held at 45.1%. That combination of top line momentum with very high profitability keeps the resale franchise narrative alive. The special US$4.00 dividend, funded from cash on hand, reinforces the view that underlying cash generation from the store network and leasing arm remains supportive of shareholder payouts. Bearish arguments do not disappear with this print. Margin compression from 48.8% to 45.1% on a trailing basis means profitability is moving in the wrong direction even as sales improve. That matters for a mature franchisor where efficiency is part of the pitch. The board's decision to return about US$14.2m through a special dividend while also flagging an upcoming debt maturity keeps leverage and negative equity worries alive for anyone focused on balance sheet resilience rather than near term earnings strength. Are analysts backing the idea that Winmark can keep funding hefty dividends while carrying high leverage and negative equity? Check the consensus price target analysis for Winmark. Winmark shows how earnings resilience and a complex balance sheet can affect investor sentiment. The real opportunity is in stocks that could be undervalued before the market reassesses them. - Company 1 - 49% below our estimate - uses a digital lending platform to deepen small business relationships while managing credit costs and overhead. - Company 2 - 50% below our estimate - expands a dense coffee store network and app based ordering while testing delivery and rental spending impact on unit economics. - Company 3 - 44% below our estimate - converts a large project backlog for data centers and industrial sites into recurring mechanical and electrical work that relies on multi year build programs. Three companies from the same screener. Open the full list of 33 companies trading below our fair value estimates → This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Companies discussed in this article include WINA. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]

Winmark (WINA) moved back into focus after its board approved both a regular quarterly cash dividend of $1.02 per share and a one off $4.00 special payout, alongside fresh third quarter results. These dividends and the solid third quarter update arrived after a mixed run for Winmark's stock, with the share price jumping 5.52% over the last day but still down 23.39% over 90 days and the 1 year total shareholder return falling 31.64%, even though the 5 year total shareholder return sits at 58.73%. This suggests that short term momentum has faded while the longer record remains positive. Scan how Winmark's dividend move compares with other companies returning cash to investors by reviewing the hand picked 7 dividend fortresses in the same income focused corner of the market. Winmark now looks like a solid cash generator whose stock has stumbled. The next step is working out whether that combination still adds up to a fair price or a clear mismatch. At a last close of $297.97, Winmark trades on a P/E of 26.3x, which puts the stock on a richer valuation than both its industry and peer averages. The P/E ratio compares the current share price to earnings per share and gives a quick read on how much investors are paying for each dollar of profit. For a franchisor such as Winmark, where much of the model relies on royalty income and comparatively asset light operations, that multiple often reflects expectations for steady cash generation rather than rapid expansion. Winmark has high quality earnings and its profits are forecast to grow 8.5% per year, while earnings have grown 1.6% per year over the past 5 years. The flip side is that the current 26.3x P/E looks expensive versus the US Specialty Retail industry on 17x and a peer group at 16.8x. It also sits well above an estimated fair P/E of 11.6x, which is a level the market could move toward if sentiment cools. Explore the SWS fair ratio for Winmark. Result: Price-to-earnings of 26.3x (OVERVALUED) Still, the Winmark story could be knocked off course if the equipment leasing arm underperforms or if resale franchise demand cools following the recent share price weakness. Find out about the key risks to this Winmark narrative. The P/E math paints Winmark as expensive. Yet our DCF model points the other way, with an estimated future cash flow value of $306.99 versus a share price of $297.97. That margin is small. It still raises a key question: Is the market overreacting to recent setbacks or correctly pricing slower growth and higher debt? For a closer look at how cash flows drive that valuation signal, you can Look into how the SWS DCF model arrives at its fair value. Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Winmark for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 32 high quality undervalued stocks. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity. Sentiment on Winmark appears divided between its solid cash generation and a relatively high valuation, so consider acting quickly and testing the numbers against your own expectations by weighing up the 2 key rewards and 3 important warning signs You have seen how Winmark is priced today, so now is the moment to widen your watchlist and pressure test your thesis against other opportunities. - Target stronger value by reviewing companies flagged in the 32 high quality undervalued stocks that pair quality fundamentals with prices that may lag their underlying business strength. - Reduce portfolio stress by scanning the 32 resilient stocks with low risk scores built around resilient balance sheets and more measured risk profiles. - Spot potential future leaders early by checking the 20 high quality undiscovered gems before crowd attention catches up. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Companies discussed in this article include WINA. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]

MINNEAPOLIS, October 14, 2026--(BUSINESS WIRE)--Winmark Corporation (Nasdaq: WINA) announced today net income for the quarter ended September 26, 2026 of $11,818,100 or $3.21 per share diluted compared to net income of $11,136,500 or $3.02 per share diluted in 2025. For the nine months ended September 26, 2026, net income was $31,467,700 or $8.51 per share diluted compared to net income of $31,694,200 or $8.61 per share diluted for the same period last year. 2025 year-to-date results included $2.2 million of leasing income from the settlement of customer litigation. "During the quarter, Winmark launched the North American Advertising Fund for Plato's Closet and recently delivered a point-of-sale pilot at one of our franchised locations. Additionally, we have announced North American Advertising Funds for our Once Upon A Child and Play It Again Sports brands for campaigns starting in 2027," stated Brett D. Heffes, Chair and Chief Executive Officer. "For many years Winmark and our franchisees have underinvested in the marketing necessary to consistently amplify our message across North America. We are taking the appropriate steps to expand awareness of our brands." Winmark - the Resale Company®, is a nationally recognized franchisor focused on sustainability and small business formation. We champion and guide entrepreneurs interested in operating one of our award winning resale franchises: Plato's Closet®, Once Upon A Child®, Play It Again Sports®, Style Encore® and Music Go Round®. At September 26, 2026, there were 1,398 franchises in operation and over 2,800 available territories. An additional 79 franchises have been awarded but are not open. This press release contains forward-looking statements within the meaning of the safe harbor provisions of Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), relating to future events or the future financial performance of the Company. Such forward-looking statements are only predictions or statements of intention subject to risks and uncertainties and actual events or results could differ materially from those anticipated. Because actual results may differ, shareholders and prospective investors are cautioned not to place undue reliance on such forward-looking statements. WINMARK CORPORATION CONDENSED BALANCE SHEETS (Unaudited) | | | | | | | | | | | | | | September 26, 2026 | | December 27, 2025 ASSETS Current Assets: | | | | | | Cash and cash equivalents | | $ | 27,964,200 | | | $ | 10,295,700 | Restricted cash | | | 150,000 | | | | 165,000 | Receivables, net | | | 2,253,300 | | | | 1,483,500 | Income tax receivable | | | — | | | | 463,600 | Inventories | | | 789,200 | | | | 362,500 | Prepaid expenses | | | 1,447,200 | | | | 1,325,700 | Total current assets | | | 32,603,900 | | | | 14,096,000 | | | | | | | Property and equipment, net | | | 1,214,400 | | | | 1,219,000 | Operating lease right of use asset | | | 1,482,300 | | | | 1,761,500 | Intangible assets, net | | | 2,020,800 | | | | 2,286,300 | Capitalized software | | | 2,272,400 | | | | — | Goodwill | | | 607,500 | | | | 607,500 | Other assets | | | 528,500 | | | | 506,400 | Deferred income taxes | | | 4,304,900 | | | | 4,407,400 | | | $ | 45,034,700 | | | $ | 24,884,100 | | | | | | | LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT) Current Liabilities: | | | | | | Accounts payable | | $ | 1,824,800 | | | $ | 1,673,900 | Income tax payable | | | 100,200 | | | | — | Accrued liabilities | | | 6,612,500 | | | | 2,324,800 | Deferred revenue | | | 1,666,900 | | | | 1,667,300 | Total current liabilities | | | 10,204,400 | | | | 5,666,000 | Long-Term Liabilities: | | | | | | Line of credit/Term loan | | | 30,000,000 | | | | 30,000,000 | Notes payable, net | | | 29,974,700 | | | | 29,961,000 | Deferred revenue | | | 8,447,400 | | | | 8,350,100 | Operating lease liabilities | | | 1,869,500 | | | | 2,414,200 | Other liabilities | | | 1,936,000 | | | | 2,175,200 | Total long-term liabilities | | | 72,227,600 | | | | 72,900,500 | Shareholders' Equity (Deficit): | | | | | | Common stock, no par, 10,000,000 shares authorized, 3,559,195 and 3,571,861 shares issued and outstanding | | | 15,181,700 | | | | 19,612,800 | Retained earnings (accumulated deficit) | | | (52,579,000 | ) | | | (73,295,200 | ) Total shareholders' equity (deficit) | | | (37,397,300 | ) | | | (53,682,400 | ) | | $ | 45,034,700 | | | $ | 24,884,100 | | | | | | | | | | | | | | | | | | | | | | WINMARK CORPORATION CONDENSED STATEMENTS OF OPERATIONS (Unaudited) | | | | | | | | | | | | | | | Three Months Ended | | Nine Months Ended | | | September 26, 2026 | | September 27, 2025 | | September 26, 2026 | | September 27, 2025 | Revenue: | | | | | | | | | | | | | Royalties | | $ | 21,707,800 | | | $ | 20,911,300 | | | $ | 61,087,600 | | | $ | 57,348,000 | | North American advertising fund | | | 3,825,300 | | | | — | | | | 3,825,300 | | | | — | | Software | | | 497,100 | | | | 93,100 | | | | 678,900 | | | | 278,900 | | Franchise fees | | | 330,100 | | | | 417,600 | | | | 1,092,500 | | | | 1,088,100 | | Merchandise sales | | | 1,031,500 | | | | 693,600 | | | | 2,544,700 | | | | 2,438,500 | | Leasing income | | | — | | | | 46,600 | | | | — | | | | 2,401,100 | | Other | | | 498,700 | | | | 470,700 | | | | 1,477,200 | | | | 1,414,800 | | Total revenue | | | 27,890,500 | | | | 22,632,900 | | | | 70,706,200 | | | | 64,969,400 | | North American advertising fund expense | | | 3,825,300 | | | | — | | | | 3,825,300 | | | | — | | Cost of merchandise sold | | | 947,300 | | | | 663,300 | | | | 2,384,200 | | | | 2,318,100 | | Selling, general and administrative expenses | | | 7,332,100 | | | | 7,046,400 | | | | 22,708,200 | | | | 21,070,500 | | Income from operations | | | 15,785,800 | | | | 14,923,200 | | | | 41,788,500 | | | | 41,580,800 | | Interest expense | | | (610,300 | ) | | | (610,300 | ) | | | (1,834,000 | ) | | | (1,833,900 | ) | Interest and other income | | | 242,100 | | | | 310,300 | | | | 516,500 | | | | 714,800 | | Income before income taxes | | | 15,417,600 | | | | 14,623,200 | | | | 40,471,000 | | | | 40,461,700 | | Provision for income taxes | | | (3,599,500 | ) | | | (3,486,700 | ) | | | (9,003,300 | ) | | | (8,767,500 | ) | Net income | | $ | 11,818,100 | | | $ | 11,136,500 | | | $ | 31,467,700 | | | $ | 31,694,200 | | Earnings per share - basic | | $ | 3.29 | | | $ | 3.13 | | | $ | 8.79 | | | $ | 8.94 | | Earnings per share - diluted | | $ | 3.21 | | | $ | 3.02 | | | $ | 8.51 | | | $ | 8.61 | | Weighted average shares outstanding - basic | | | 3,588,328 | | | | 3,553,211 | | | | 3,581,906 | | | | 3,543,766 | | Weighted average shares outstanding - diluted | | | 3,685,668 | | | | 3,693,154 | | | | 3,697,251 | | | | 3,679,745 | | | | | | | | | | | | | | | | | | | WINMARK CORPORATION CONDENSED STATEMENTS OF CASH FLOWS (Unaudited) | | | | | | | | | Nine Months Ended | | | September 26, 2026 | | September 27, 2025 | OPERATING ACTIVITIES: | | | | | | | Net income | | $ | 31,467,700 | | $ | 31,694,200 | Adjustments to reconcile net income to net cash provided by operating activities: | | | | | | | Depreciation of property and equipment | | | 281,300 | | | 295,500 | Amortization of intangible assets | | | 265,500 | | | 265,500 | Compensation expense related to stock options | | | 1,917,200 | | | 1,666,900 | Deferred income taxes | | | 102,600 | | | 160,100 | Operating lease right of use asset amortization | | | 279,200 | | | 252,700 | Tax benefits on exercised stock options | | | 898,800 | | | 1,091,900 | Change in operating assets and liabilities: | | | | | | | Receivables | | | (769,800) | | | (316,500) | Income tax receivable/payable | | | (335,000) | | | (998,500) | Inventories | | | (426,700) | | | 113,900 | Prepaid expenses | | | (121,600) | | | (44,500) | Other assets | | | (22,100) | | | (5,000) | Accounts payable | | | 150,900 | | | (188,800) | Accrued and other liabilities | | | 1,763,500 | | | 2,054,900 | Deferred revenue | | | 96,900 | | | 331,500 | Net cash provided by operating activities | | | 35,548,400 | | | 36,373,800 | INVESTING ACTIVITIES: | | | | | | | Capitalized software | | | (2,272,400) | | | — | Purchase of property and equipment | | | (276,700) | | | (172,700) | Net cash used for investing activities | | | (2,549,100) | | | (172,700) | FINANCING ACTIVITIES: | | | | | | | Repurchases of common stock | | | (8,091,600) | | | (2,418,700) | Proceeds from exercises of stock options | | | 3,497,200 | | | 3,754,000 | Dividends paid | | | (10,751,400) | | | (9,991,400) | Net cash used for financing activities | | | (15,345,800) | | | (8,656,100) | NET INCREASE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH | | | 17,653,500 | | | 27,545,000 | Cash, cash equivalents and restricted cash, beginning of period | | | 10,460,700 | | | 12,329,800 | Cash, cash equivalents and restricted cash, end of period | | $ | 28,114,200 | | $ | 39,874,800 | | | | | | | | SUPPLEMENTAL DISCLOSURES: | | | | | | | Cash paid for interest | | $ | 1,802,900 | | $ | 1,815,500 | Cash paid for income taxes | | $ | 8,210,800 | | $ | 8,514,100 | | | | | | | | SUPPLEMENTAL NONCASH FINANCING ACTIVITIES | | | | | | | During the nine months ended September 26, 2026, the Company repurchased $9.85 million of its common stock under its share repurchase program. At September 26, 2026, $1.75 million of such repurchases was included in Accrued liabilities within the Condensed Balance Sheets. Cash payments for repurchased shares during the quarter totaled $8.10 million. | | | | | | | | The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the Condensed Balance Sheets to the total of the same amounts shown above: | | Nine Months Ended | | | September 26, 2026 | | September 27, 2025 | Cash and cash equivalents | | $ | 27,964,200 | | $ | 39,734,800 | Restricted cash | | | 150,000 | | | 140,000 | Total cash, cash equivalents and restricted cash | | $ | 28,114,200 | | $ | 39,874,800 | View source version on businesswire.com: https://www.businesswire.com/news/home/20261014697520/en/ Contacts Anthony D. Ishaug 763/520-8500