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Investing in Winmark: A 121% Gain in Five Years

AInvestMonday, Jan 6, 2025 8:08 am ET
6min read


Winmark Corporation (NASDAQ: WINA) has been a standout performer in the resale retail market over the past five years, delivering a remarkable 121% gain to investors who bought the stock in 2020. The company's innovative business model, commitment to sustainability, and strategic growth initiatives have all contributed to its impressive financial performance. In this article, we will explore the key factors that have driven Winmark's success and discuss the potential for continued growth in the coming years.



Winmark's Franchise Model: A Driver of Growth and Profitability
Winmark's franchise model has been a critical factor in its growth and profitability over the past five years. The company operates a franchise system that empowers entrepreneurs to open and manage stores under its well-established brands, such as Plato's Closet, Once Upon A Child, Play It Again Sports, Music Go Round, and Style Encore. This model allows Winmark to expand its footprint rapidly without bearing the full cost of opening new stores, creating a scalable and sustainable business growth strategy.

As of September 28, 2024, there were 1,343 franchises in operation and over 2,800 available territories. An additional 82 franchises have been awarded but are not yet open. This expansion has led to an increase in revenue streams, including franchise fees, royalty fees, and sales of used goods from company-owned stores. Additionally, Winmark generates income through training and support fees for new franchisees.

Winmark's diverse brand portfolio allows the company to appeal to different consumer segments, catering to various niches within the resale market. This diversification has enabled Winmark to maintain a strong market position and adapt to changing consumer preferences.



Strategic Acquisitions and Partnerships: Enhancing Winmark's Market Position
Strategic acquisitions and partnerships have played a significant role in Winmark's success during this period. The company has expanded its franchise brands and formed strategic alliances with influential figures and organizations to enhance its brand image and reach a broader audience.

One notable example is Winmark's partnership with PGA Tour golfer Tom Hoge. In January 2025, Winmark announced a four-year partnership extension with Hoge, who will continue to serve as the company's brand ambassador and wear Winmark and Play It Again Sports logos on his apparel in PGA Tour events. This partnership aligns with Winmark's commitment to leveraging the power of sport to amplify its values and promote a sustainable future (Winmark – the Resale Company Extends Partnership with PGA Tour® Golfer Tom Hoge, 2025).

Winmark's commitment to sustainability and community engagement has also resonated with its franchisees and customers. The company's franchise system allows entrepreneurs to open and manage stores under its well-established brands, fostering local entrepreneurship and economic growth. This commitment to sustainability has contributed to Winmark's financial success, with revenue growth, although slightly negative in 2024 (-0.036), supported by its diverse brand portfolio and low overhead for franchisees.



Conclusion: Winmark's Bright Future in the Resale Retail Market
Winmark Corporation's impressive 121% gain over the past five years is a testament to the company's innovative business model, commitment to sustainability, and strategic growth initiatives. The company's franchise model, diverse brand portfolio, and commitment to sustainability have all contributed to its financial success and positioned Winmark for continued growth in the coming years.

Investors who bought Winmark stock in 2020 have reaped the benefits of the company's strategic approach to the resale retail market. As Winmark continues to expand its franchise network and form strategic partnerships, it is well-positioned to capitalize on the growing demand for sustainable and affordable shopping options. With a market capitalization of $13.68 billion as of January 6, 2025, Winmark remains an attractive investment opportunity for those seeking exposure to the resale retail market and the broader retail sector.

In summary, Winmark's impressive performance over the past five years demonstrates the power of its innovative business model and commitment to sustainability. As the company continues to grow and adapt to changing market trends, it remains an attractive investment opportunity for those seeking exposure to the resale retail market and the broader retail sector.
Disclaimer: the above is a summary showing certain market information. AInvest is not responsible for any data errors, omissions or other information that may be displayed incorrectly as the data is derived from a third party source. Communications displaying market prices, data and other information available in this post are meant for informational purposes only and are not intended as an offer or solicitation for the purchase or sale of any security. Please do your own research when investing. All investments involve risk and the past performance of a security, or financial product does not guarantee future results or returns. Keep in mind that while diversification may help spread risk, it does not assure a profit, or protect against loss in a down market.