It’s a mall-facing staple, but despite this—and the general decline of malls—Build-a-Bear Workshop (NASDAQ:BBW) is still going strong. Indeed, it gained nearly 11% at the time of writing and, at one point, hit a high that it hasn’t seen since 2007.
Unquestionably, the biggest reason for the hefty run-up in Build-a-Bear came down to the earnings report it turned in early this morning. Build-A-Bear posted earnings of $0.57, which readily beat analyst expectations of $0.41. Its revenue of $109.23 million not only beat analyst projections of $101.89 million, but it also topped Q2 2022’s figures by 8.5%. Build-a-Bear doesn’t expect the cuddly fun train to stop rolling, either; it’s expecting full-year 2023 revenue to come out between 5% and 7% higher than this time last year.
Driving a lot of those gains is the sheer range of new stores that Build-a-Bear plans to open up. Another 20 to 30 new locations should open up before this fiscal year is up. Build-a-Bear has also been working diligently to expand its offerings. While, for the most part, Build-a-Bear was a kid-focused operation—which by itself isn’t bad, as kids have access to a lot of mom and dad’s discretionary income—Build-a-Bear also stepped up its offerings geared toward teenagers and even adults. Given the way things are these days, it’s not surprising that even a grown adult might derive a little comfort from a stuffed animal.
Interestingly, hedge funds are also starting to put a little extra life under Build-a-Bear. Hedge funds added 1,400 shares of BBW stock to their holdings in the last quarter, ticking the confidence signal off pure Neutral for the first time in quite some time. In fact, this is the first time that hedge funds bought in on Build-a-Bear Workshop stock, on average, after two consecutive quarters of reduced holdings.
