BAB (BABB) AI Stock Analysis

BAB

(Other OTC:BABB)

Select Model

Rating:71Outperform

Price Target:$0.90▲(10.96% Upside)

Action:upgraded

Date:10/15/26

BAB scores well above average, driven by a financially disciplined, highly profitable franchising model with expanding margins, a virtually debt-free balance sheet, and free cash flow that fully converts earnings into cash. A low P/E of 9.2 paired with a 6.1% dividend yield adds further support. The score is held back by a flat revenue base near $3.5 million that leaves growth dependent on cost control, very small scale that limits resilience, and a technical picture in which the price trades below all major moving averages with mildly negative momentum.

Positive Factors

Strong profitabilitySustained high operating and net margins indicate that BAB converts revenue into profit efficiently and has preserved earnings power across periods. This profitability can support reinvestment, dividends, and resilience over the next several quarters if operating conditions remain broadly stable.

Negative Factors

Modest, uneven revenue growthThe limited and inconsistent top-line trajectory suggests BAB is currently a steady rather than fast-growing business. If revenue expansion remains subdued, operating leverage and future earnings growth may be constrained even though current margins remain healthy.

BAB (BABB) vs. SPDR S&P 500 ETF (SPY)

Market Cap: $5.88M
Dividend Yield: 6.15%
Average Volume (3M): 3,568
Price to Earnings (P/E): 9.0
Beta (1Y): 0.06
Revenue Growth: 7.65%
EPS Growth: 17.17%
Country: US
Employees: 11
Sector: Consumer Defensive
Sector Strength: 62
Industry: Food Confectioners

BAB Business Overview & Revenue Model

Company Description

BAB, Inc. franchises and licenses bagel and muffin retail units under the Big Apple Bagels (BAB), My Favorite Muffin (MFM), and SweetDuet (SD) trade names in the United States. The company’s BAB franchised brand includes baked bagels, flavored cream...

BAB Financial Statement Overview

Summary

BAB's asset-light franchising model delivers exceptional quality metrics: ~91% gross margin, ~25% operating margin, and a net margin that has expanded every year from 13.1% (FY2022) to 18.5% TTM. The balance sheet is near-unlevered (debt-to-equity of 0.08) with equity funding ~72% of assets, and ROE has improved to ~18.5%. Cash flow is high quality, with TTM operating cash flow of ~$690K and free cash flow of ~$698K fully covering net income. Offsetting these strengths are a stagnant top line stuck around $3.3–3.5 million for four years, a very small absolute scale that limits resilience to the loss of a major franchise partner, and lumpy year-to-year cash flow driven by working-capital timing.

Income Statement

74Positive

Balance Sheet

82Very Positive

Cash Flow

76Positive

Financial statement breakdown
Breakdown	TTM	Nov 2025	Nov 2024	Nov 2023	Nov 2022	Nov 2021
Income Statement
Total Revenue	3.54M	3.44M	3.55M	3.51M	3.29M	3.07M
Gross Profit	3.22M	3.43M	3.55M	3.51M	3.18M	2.09M
EBITDA	887.09K	784.52K	681.08K	618.58K	612.62K	775.41K
Net Income	654.28K	559.04K	525.20K	467.32K	431.99K	651.12K
Balance Sheet
Total Assets	5.15M	5.02M	4.84M	4.30M	4.29M	4.46M
Cash, Cash Equivalents and Short-Term Investments	2.40M	2.15M	2.18M	1.89M	1.62M	1.46M
Total Debt	293.60K	330.21K	378.06K	39.82K	153.70K	260.09K
Total Liabilities	1.45M	1.55M	1.50M	1.12M	1.22M	1.53M
Stockholders Equity	3.71M	3.46M	3.34M	3.18M	3.08M	2.93M
Cash Flow
Free Cash Flow	697.58K	406.74K	636.70K	533.19K	135.04K	715.77K
Operating Cash Flow	690.05K	414.39K	637.75K	534.37K	135.04K	718.30K
Investing Cash Flow	-2,631	-5,646	-9,960	-1,180	0	-2,525
Financing Cash Flow	-363.18K	-435.81K	-363.18K	-363.18K	-290.54K	-290.54K

BAB Technical Analysis

Technical Analysis SentimentNegative

Last Price0.81

Price Trends

50DMA0.83Negative

100DMA0.83Negative

200DMA0.87Negative

Market Momentum

MACD-0.00Positive

RSI45.87Neutral

STOCH24.64Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BABB, the sentiment is Negative. The current price of 0.81 is below the 20-day moving average (MA) of 0.82, below the 50-day MA of 0.83, and below the 200-day MA of 0.87, indicating a bearish trend. The MACD of -0.00 indicates Positive momentum. The RSI at 45.87 is Neutral, neither overbought nor oversold. The STOCH value of 24.64 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for BABB.

BAB Peers Comparison

Overall Rating

UnderperformOutperform

Sector (62)

Financial Indicators

BABB against its peers
Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
BABB	71Outperform	$5.90M	9.00	18.48%	6.15%	7.65%	17.17%
Sector *	62Neutral	$20.33B	14.63	-3.31%	3.23%	1.93%	-12.26%
PETZ	60Neutral	$12.80M	7.26	5.92%	―	121.96%	-14.68%
BON	51Neutral	$9.31M	-0.49	-20.98%	―	-12.92%	-173.30%
FAMI	45Neutral	$3.67M	-0.00	-77.20%	―	-58.43%	-252.50%
SOWG	42Neutral	$42.01M	-0.05	-1651.95%	―	―	―

* Consumer Defensive Sector Average

Performance Comparison

BABB and its peers over the selected period
Ticker	Company Name	Price	Change	% Change
BABB	BAB	0.81	-0.06	-6.77%
PETZ	Tdh Holdings	1.24	0.19	18.10%
FAMI	Farmmi	0.10	-1.49	-93.84%
SOWG	Sow Good Inc.	2.09	-9.76	-82.36%
BON	Bon Natural Life Limited	1.14	-0.62	-35.23%

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.

Date of analysis: Oct 15, 2026

BAB AI Stock Analysis