Mister Car Wash Valuation Recalibration

All has not been rainbows and butterflies for Mister Car Wash in the equity markets. While it still is one of the darlings in the space, Wall Street has not been too kind to the share price. Since debuting on the public market stock exchange, their valuation multiple as measured by Market Cap to Adjusted EBITDA has fallen from a high of 41x down to a 7.29x today (Feburary 2025).

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Pre-IPO (2019–2020)

2019:

• EBITDA: $139.5 million (reported in IPO prospectus for the year)
• Market Cap: Not publicly traded, but Leonard Green & Partners acquired it in 2014, and by the IPO in 2021, it was valued at $4.44 billion. No precise 2019 market cap exists publicly, so we exclude this year from the multiple calculation.

2020:

• EBITDA: $161 million (reported in IPO prospectus).
• Market Cap: Still private, but the enterprise value at IPO in mid-2021 was $5 billion (including $560 million net debt). Assuming a similar valuation trajectory, market cap might approximate $4.44 billion minus debt, but this is speculative without exact pre-IPO valuation snapshots.

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IPO and Post-IPO (2021–2024)

IPO Date (June 25, 2021):

• Stock debuted at $15 per share, closing at $20.58, with 296 million shares outstanding initially (per IPO prospectus).
• Market Cap: $20.58 × 296 million = $6.09 billion (end of first trading day).
• EBITDA (2020 trailing): $161 million (latest full-year figure at IPO).
• Multiple: $6.09 billion / $161 million ≈ 37.83x.

Peak Stock Price 2021 (August 3, 2021):

• Stock hit $22.47 (highest historic closing price per Yahoo Finance).
• Shares Outstanding: Approximately 300.5 million (adjusted for post-IPO dilution per 2021 10-K).
• Market Cap: $22.47 × 300.5 million = $6.75 billion.
• EBITDA (2020 trailing): $161 million (used by analysts at IPO; 2021 full-year not yet available).
• Multiple: $6.75 billion / $161 million ≈ 41.93x.

2021 Year-End:

• Market Cap: $5.71 billion (December 31, 2021, stock at $18.95, 301.5 million shares per MacroTrends).
• EBITDA (2021 full-year): $258.374 million (adjusted EBITDA from 2021 10-K).
• Multiple: $5.71 billion / $258.374 million ≈ 22.11x.

2022 Year-End:

• Market Cap: $2.77 billion (stock at $9.18, 302.25 million shares per MacroTrends).
• EBITDA: $281.687 million (adjusted EBITDA from 2022 10-K).
• Multiple: $2.77 billion / $281.687 million ≈ 9.84x.

2023 Year-End:

• Market Cap: $2.62 billion (stock at $8.64, 303.5 million shares per MacroTrends).
• EBITDA: $285.924 million (adjusted EBITDA from 2023 10-K).
• Multiple: $2.62 billion / $285.924 million ≈ 9.16x.

2024 Year-End:

• Market Cap: $2.34 billion (January 21, 2025, per Stock Analysis, closest to year-end; assumed stable to December 31, 2024).
• EBITDA: $320.946 million (adjusted EBITDA from 2024 10-K).
• Multiple: $2.34 billion / $320.946 million ≈ 7.29x.

February 25, 2025:

• Market Cap: $2.44 billion (per CompaniesMarketCap.com).
• EBITDA (2024 trailing): $320.946 million.
• Multiple: $2.44 billion / $320.946 million ≈ 7.60x.

Analysis

• The highest historic Market Cap to EBITDA multiple appears at the stock’s peak on August 3, 2021, at approximately 41.93x, using the 2020 EBITDA of $161 million. This reflects the market’s exuberance post-IPO, valuing the company’s growth potential highly against its pre-IPO earnings.
• Post-IPO, as full-year EBITDA figures became available, the multiple dropped significantly due to increased earnings and a declining stock price. For instance, using 2021’s full-year EBITDA reduces the multiple at the peak to $6.75 billion / $258.374 million ≈ 26.13x, still high but more grounded.
• GuruFocus data cites an EV/EBITDA peak of 164.98 over the past five years, but this includes debt and likely reflects a pre-IPO anomaly or miscalculation (e.g., using a quarterly figure). Market Cap to EBITDA avoids debt, and no credible source supports a multiple that high with market cap alone.

Conclusion

Mister Car Wash’s highest historic Market Cap to EBITDA multiple was approximately 41.9x, recorded on August 3, 2021, when its market cap peaked at $6.75 billion against a trailing 2020 EBITDA of $161 million. This reflects the market’s peak optimism shortly after its IPO. Subsequent multiples have trended lower as EBITDA grew and market cap stabilized or declined, aligning more with industry norms by 2024 (around 7–9x).