蒙罗公司（MNRO）：随着管理层推出改进计划，季度内可比业务反弹势头持续

Rebounding Comp Momentum Continues QTDas Mgmt Rolls Out Improvement Plan Q4 adj EPS -$0.09 missed cons +$0.03 w/ GM -250 bps y/y pressured by laborinflation & mix shift. Comp +2.8% was better than cons +0.2% supported byrecovering sales momentum and continued QTD +7%. We favorably view newmgmt's plan to close 145 underperforming stores (~10% of store base but ~5%of rev) which should be a margin tailwind as '26 progresses (mgmt expectsadj EPS y/y growth) while other sales and margin initiatives likely show slowerprogression. Comps show sequential improvement into FY'26 as the bar gets lower while mgmt looks to buildon momentum.Q4 comp (+2.8%) saw consistent improvement w/ Jan -2.1% (pressured by storeclosures from inclement weather), Feb +1.9%, & March +8.2% (vs notably low -10.3% in FY'24), w/momentum continuing into Q1'26, w/ April +7.1% (vs -13%) & May +5.9% (vs -11.1%). Front/endshocks (+27%) & batteries (+25%) drove Q4 growth, w/ tires (+2%) also positive while alignments(-1%) were the laggard. Traffic was -LSD% w/ ticket +MSD% while traffic notably turned positive inMarch and has remained healthy QTD. Looking ahead we expect comps see continued strengthagainst low bars (Q1'25 -9.9% & Q2 -5.8%) as mgmt noted pricing pass through related to tariffsmay be a further tailwind in '26. While we expect industry demand for vehicle maintenance shouldbe healthy in NT, we remain believe MNRO has a long road to recovery after an extended periodof market share loss and expect marketing & customer experience/retention initiatives may taketime to gain traction. GM pressured by trade downs, self funded promos & higher tech costs as MNRO looks toleverage savings from store closures & improving sales moving forward.Q4 GM was -250 bps y/y to 33.0% (vs est 34.5%) w/ 160 bps of headwinds related to tire trade downs & self-funded promosand 80 bps from technician wage inflation. SG&A was flat y/y at $100M (+180 bps to 34.0% of rev)ex-$21M impairment cost. While these GM pressures likely persist in NT, we expect improvementoff of Q4 trough via merchandising/pricing efforts & improved sales leverage. New CEO outlines key areas for improvement led by Q1'26 closures of 145 underperformingstores.New mgmt. outlined initial plans for performance improvement w/ a NT focus onclosing 145 underperforming stores in Q1'26 and additional opportunities in improving customerexperience,acquiring/retaining more profitable customer mix&increasing merchandisingproductivity/mitigating tariff risks. Despite representing ~10% of store base, mgmt ests theseclosures represent sales of $45M or only ~5% of annualized rev, as we expect this move to drivesome margin expansion w/ potential for a portion of lost sales to be recaptured by nearby MNROlocations. Bret Jordan, CFA * | Equity Analyst(617) 342-7926 | bjordan1@jefferies.comPatrick Buckley, CFA * | Equity Associate+1 (617) 342-7857 | pbuckley1@jefferies.comCJ Dipollino, CFA * | Equity Associate(617) 342-7876 | cdipollino@jefferies.com The Long View: Monro, Inc. Risk/Reward - 12 Month View Investment Thesis / Where We Differ •Acquisition pace remains steady over the longer term while MNRO alsofocuses on organic growth and improving operational execution.•We believe MNRO should continue to benefit over the LT from favorableindustry trends, while seeing additional growth from runway industryconsolidation as a material tailwind.•We believe downside should be limited, as MNRO could represent anattractive potential acquisition target. We note that previous strategic andprivate equity transactions have priced at 10x-15x EBITDA. Downside Scenario,$13, -22% Upside Scenario,$24, +43% Base Case,$18, +7% •Comparable store sales growth in low-singledigits range•Margins improve with operating efficienciesand cost control•Long-term acquisition growth remains steady•FY'27 adj. EPS: $0.91 Target Multiple: 20x; PriceTarget $18 •Comp growth improves to mid-single-digits asutilization increases and pent-up demand isrealized•Operating margins rebound significantly withoperating efficiencies & improved leverage•Acquisition growth accelerates•FY'27 adj. EPS: $1.04 Target Multiple: 23x; PriceTarget $24 •Near-term comparable store sales are weighedby competitor outperformance, lower vehicleutilization and technician labor availability•Wage inflation&higher costs weigh onpreviously identified cost-cutting initiatives•Acquisition growth stalls•FY'27 adj. EPS: $0.75 Target Multiple: 17x; PriceTarget $13 Sustainability Matters Catalysts Top Material Issues: (1) Customer Privacyissues have already shown up in auto repair-related legislationand can have impacts on the broader industry. If customer data is withheld from independent serviceproviders, we would expect to see repair/maintenance shift to franchised auto dealers from independentservice providers.(2) Employee Engagement, Diversity & Inclusionaddresses a company’s ability toensure that its culture, hiring and promotion practices embrace building a diver