Should Investors Follow Advent International's Lead as it Dumps $153 Million of First Watch Restaurant Group Stock?
Key Points
Boston-based Advent International sold 9,400,000 shares, worth an estimated $152.89 million.
The change represents 3.3% of Advent International’s reported 13F assets under management.
Post-trade stake: 5,289,784 shares valued at $82.73 million.
First Watch now accounts for 1.67% of fund AUM, which makes it the fund's 10th-largest position.
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Boston-based Advent International reported a significant reduction in its position in First Watch Restaurant Group (NASDAQ:FWRG) as of Sept. 30, 2025, with an estimated $152.89 million net decrease.
What happened
According to a filing with the Securities and Exchange Commission dated Nov. 14, 2025, Advent International, L.P. reduced its holdings in First Watch Restaurant Group by 9,400,000 shares.
The post-sale position stands at 5,289,784 shares, valued at $82.73 million as of Sept. 30, 2025.
What else to know
The firm’s post-sale stake in First Watch Restaurant Group represents 1.67% of reported 13F assets, down from 7.64% of AUM in the prior quarter.
Top holdings after the filing:
- NIQ Global Intelligence (NYSE:NIQ): $2.35 billion (47.1% of AUM)
- Olaplex (NASDAQ:OLPX): $654.30 million (13.1% of AUM)
- CCC Intelligent Solutions (NASDAQ:CCCS): $340.19 million (6.8% of AUM)
- Definitive Healthcare (NASDAQ:DH): $268.44 million (5.4% of AUM)
- CI&T (NYSE:CINT): $255.64 million (5.1% of AUM)
As of Dec. 5, 2025, shares were priced at $17.70, down 10% over the past year, underperforming the S&P 500 by 23 percentage points.
The company’s five-year compound annual growth rate for sales is 22%.
Company Overview
| Metric | Value |
|---|---|
| Market capitalization | $1.08 billion |
| Revenue (TTM) | $1.17 billion |
| Net income (TTM) | $5 million |
| Price (as of market close 2025-12-5) | $17.70 |
Company snapshot
First Watch Restaurant Group:
- Operates and franchises daytime-focused restaurants under the First Watch brand, offering breakfast, brunch, and lunch menu items.
- Has locations across 28 U.S. states.
- Serves a broad customer base seeking fresh, made-to-order meals in a casual dining environment.
As of Sept. 28, 2025, First Watch Restaurant Group operated 548 company-owned restaurants and 72 franchised restaurants in the United States.
Foolish take
After holding a majority stake in First Watch Restaurant Group early in 2021, Advent International has slowly unwound its outsize position in the daytime eatery.
While First Watch now accounts for only 1.7% of Advent's portfolio, the latter still holds a 9% stake in the stock, highlighting the significant disparity in size between the two.
This just highlights that investors shouldn't necessarily worry about the sale, in my opinion.
From a Foolish perspective, there is a lot to like about this unique restaurant.
Its employees only work one shift, from 7 a.m. to 2:30 p.m., streamlining operations and boosting employee satisfaction.
First Watch's menus "are chef-driven and rotate five times a year," allowing the company to focus on customizable meals that appeal to younger generations.
With a per-person average cost of $17, First Watch's meals fit into the "affordable luxury" niche and offer a reasonably priced (and healthier) alternative to the food typically provided by outdated legacy restaurant chains.
Growing sales by 26%, same-store sales by 7%, and increasing its profit margins in the last quarter, First Watch looks like an attractive growth stock at just 8 times cash from operations (CFO).
Still only operating in 28 states -- and many of these with just a single-digit store count -- First Watch's growth story is still in its early chapters. Home to a discounted valuation and growing via its own CFO, I'm going to keep a very close eye on this promising growth stock.
Glossary
13F assets under management (AUM): The total value of securities reported by institutional investment managers in quarterly SEC Form 13F filings.
Stake: The amount or percentage of ownership an investor holds in a company.
Top holdings: The largest investments in a fund's portfolio, typically by market value or percentage of assets.
Compound annual growth rate (CAGR): The mean annual growth rate of an investment over a specified period, assuming profits are reinvested.
Trailing twelve months (TTM): The 12 months ending with the most recent quarterly report.
Assets under management (AUM): The total market value of investments managed by a fund or investment firm.
Franchised restaurants: Restaurants operated by independent owners under a company's brand and business model, rather than by the company itself.
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Josh Kohn-Lindquist has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
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