Home to over 90 snacking and restaurant brands that span the quick-service, fast-casual, and traditional dining industries, MTY Food Group (OTC: MTYF.F) is one of those companies that you've probably interacted with but might not know by  name. Some of its most prominent brands are Papa Murphy's, Cold Stone Creamery, Famous Dave's, Village Inn, Wetzel's Pretzels, Thai Express, and TacoTime.

With over 7,100 locations, MTY Food Group operates the vast majority of its shops through a franchise model , giving the company an asset-light, high-margin profile. Generating positive free cash flow (FCF) every year since the turn of the century, the stock has delivered total returns of 3,600% over that time -- or seven times the S&P 500 index's return.

Despite this track record of success -- along with earnings before interest, taxes, depreciation, and amortization (EBITDA) and FCF growth of 81% and 73% over the last five years -- the share price for MTY stock trading over the counter in the U.S. is down 40% from its high.

Here's why this drop could be a once-in-a-decade opportunity for investors.

MTY Food Group: A serial acquirer

MTY Food Group has made 50 acquisitions since 1999, including 27 over the last decade. While companies that rely upon megamergers or one-off jumbo acquisitions to fuel their growth often disappoint, serial acquirers like MTY often prove to be outperforming propositions.

A recent analysis from McKinsey studying businesses from 2013 to 2022 showed that stocks with a mergers and acquisitions (M&A) program in place beat the broader market by 1.8 percentage points. Though this is a shorter time frame than I would like to see, certain companies have proven capable of reinvesting their FCF in M&A at a highly profitable rate, and MTY fits this bill.

Over the last decade, MTY has averaged a return on invested capital (ROIC) of 15%, generating high levels of FCF compared to the debt and equity it uses to fund its M&A ambitions. Compared to its weighted average cost of capital (WACC) of 7%, the company consistently creates value for investors.

Spending its FCF on new acquisitions, the company is laser-focused on building its food brands empire.

After making two hefty $200 million purchases for Wetzel's Pretzels and BBQ Holdings (Famous Dave's) in 2022, the company has paused its M&A spending over the past year. This $400 million outlay gives the company plenty of integration work to do as it focuses on paying down its $686 million net debt balance.

Though this $686 million in debt may look alarming, the company maintains a debt-to-adjusted EBITDA ratio of 2.6, which is in line with its historical norms and acceptable for a consistent FCF-generating business like MTY.

Steady free cash flow funds a growing dividend

MTY Food Group has grown its FCF-per-share by 251% over the last decade, allowing for ample dividend increases over the same time.

Had the company not paused its dividend payments during the earlier days of the pandemic out of an abundance of caution, it would have most likely raised its dividend every year since 2010. Despite these dividend increases over time, MTY's cash dividend payout ratio is a mere 14%, leaving a ton of room for future increases. Considering the company already pays a respectable dividend yield of 2.5%, there is a lot of passive income potential possible from an investment in MTY.

In addition to this promising dividend, management has been buying back shares over the last five years, reducing the company's share count by 1% annually over that time. Best yet for investors, with the board and management owning 16% of MTY's shares outstanding, they are well incentivized to continue these shareholder-friendly cash returns.

MTY's once-in-a-decade valuation

As promising as MTY's portfolio of brands, FCF growth, and serial acquisition strategy are, its current once-in-a-decade valuation may be even more intriguing.

Right now, the company's enterprise-value-to-EBITDA and enterprise-value-to-FCF ratios are very close to 10-year lows -- outside of the drop during March 2020.

In addition to these valuations, MTY's 2.5% dividend yield is well above its 10-year average of 1.5% and is its highest ever outside of 2015, when the company paid a special dividend, and during the pandemic, when the market dropped briefly.

Ultimately, MTY Food Group isn't going to set the world on fire with blazing growth rates. However, the company's track record as a serial acquirer, its top-tier FCF generation, and its ample cash returns to shareholders make the franchisor a magnificent dividend stock to buy at today's once-in-a-decade valuation.

Before you buy stock in MTY Food Group, consider this: