National Vision (EYE) trades at 16.6x 2019 EV/EBITDA, has ~3 turns of debt and generates a paltry 1.5% FCF yield that could see pressure as consumers (and possibly regulators) increase scrutiny of the company’s potentially deceptive ads – ads that are integral to the company’s ability to drive customers to its stores. In addition to its reputational risk, in my opinion, EYE is overstating EBITDA by double digit percentages via add backs and accounting gimmickry.
To their credit EYE has warned the street (see the Managed Care and Insurance section) that the growth