What was the expected volatility used in the weighted-average valuation assumptions for Bojangles for the year ended December 29, 2024?
Bojangles Franchise · 2025 FDDAnswer from 2025 FDD Document
| Years Ended | ||||
|---|---|---|---|---|
| December 29, 2024 | December 31, 2023 | |||
| Weighted-average valuation assumptions | ||||
| Expected dividend yield | 0 % | 0 % | ||
| Expected volatility | 50.0 % | 50.0 % | ||
| Expected term | 3.0 years | 3.0 years | ||
| Risk-free interest rate | 4.4% | 3.8% - 4.7% |
Source: Item 22 — CONTRACTS (FDD page 82)
What This Means (2025 FDD)
According to Bojangles's 2025 Franchise Disclosure Document, the expected volatility used in the weighted-average valuation assumptions for the year ended December 29, 2024, was 50.0%. This figure is a key input in financial models used to assess the value of certain assets or liabilities held by Bojangles. Volatility, in this context, reflects the degree of variation in the price of a financial instrument over time.
For a prospective franchisee, understanding these valuation assumptions is crucial, although the direct impact may be limited. The weighted-average valuation assumptions are primarily used internally by Bojangles for financial reporting and impairment testing of assets like the Bojangles brand itself. While franchisees are not directly involved in these calculations, the overall financial health and brand value of Bojangles, as influenced by these assumptions, can affect the franchise system's stability and long-term prospects.
The FDD also indicates that the expected dividend yield was 0%, the expected term was 3.0 years, and the risk-free interest rate was 4.4% for the year ended December 29, 2024. These figures, along with the volatility, provide a snapshot of the financial environment and assumptions under which Bojangles assesses its assets. Franchisees may want to discuss these assumptions with a financial advisor to understand their potential implications for the franchise's performance and value.