BBB Foods, Inc. Class A (TBBB) AI Stock Analysis

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BBB Foods, Inc. Class A

(NYSE:TBBB)

65Neutral

BBB Foods, Inc. Class A exhibits robust financial performance and a positive earnings outlook. However, high leverage and valuation concerns weigh down the overall score. The technical analysis suggests mixed market sentiment, and the absence of a dividend yield further impacts valuation.

Positive Factors

Financial performance

TBBB swung to a profit from a prior-year loss, showcasing improved financial performance.

Growth potential

Store openings are outpacing the plan, indicating strong growth potential for TBBB.

Negative Factors

Non-recurring expenses

TBBB incurred significant non-recurring expenses, largely related to its IPO and compliance requirements.

Stock offering impact

Shares are expected to trade off on news of the offering and some expense related concerns.

BBB Foods, Inc. Class A (TBBB) vs. S&P 500 (SPY)

Market Cap

$3.13B

Dividend YieldN/A

Average Volume (3M)733.70K

Price to Earnings (P/E)―

Beta (1Y)1.27

Revenue GrowthN/A

EPS GrowthN/A

CountryUS

Employees25,300

SectorGeneral

Sector StrengthN/A

IndustryDiscount Stores

Share Statistics

EPS (TTM)N/A

Shares Outstanding62,048,107

10 Day Avg. Volume661,749

30 Day Avg. Volume733,704

Financial Highlights & Ratios

PEG Ratio2.63

Price to Book (P/B)15.08

Price to Sales (P/S)0.00

P/FCF Ratio46.94

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$37.67

Price Target Upside35.02% Upside

Rating ConsensusStrong Buy

Number of Analyst Covering3

BBB Foods, Inc. Class A Business Overview & Revenue Model

Company DescriptionBBB Foods Inc., through its subsidiaries, operates grocery retail stores in Mexico. It offers food products, drinks, hygiene and beauty products, home clean products, coffee, tea and substitutes, jellies and desserts, and baby and pet products. The company also provides branded, private label, and spot products. In addition, it offers its products through online. The company serves low-to-middle income households. The company was incorporated in 2004 and is headquartered in Mexico City, Mexico.

How the Company Makes MoneyBBB Foods, Inc. generates revenue primarily through the sale of its diverse portfolio of food and beverage products. The company operates through various channels, including direct sales to retailers, partnerships with foodservice providers, and supply agreements with industrial clients. A significant portion of its earnings comes from strategic partnerships and licensing deals with other food and beverage brands, enhancing its market reach and product offerings. Additionally, BBB Foods invests in marketing and distribution networks to maximize its market penetration and brand recognition, further bolstering its revenue streams.

BBB Foods, Inc. Class A Financial Statement Overview

Summary

BBB Foods, Inc. Class A shows strong revenue and profit growth, with a significant improvement in stockholders' equity. However, leverage remains a concern with a debt-to-equity ratio of 2.28. Cash flows are robust, supporting operational cash generation, but careful cash management is needed to maintain this trajectory.

Income Statement

Very Positive

BBB Foods, Inc. Class A has shown strong revenue growth, with a 30.26% increase from 2023 to 2024. The company has successfully transitioned from a net loss in 2023 to a net profit in 2024, resulting in an improved net profit margin of 0.58%. Gross profit margins have held steady, indicating effective cost management. However, EBIT and EBITDA margins, while improved, remain modest at 2.31% and 6.07% respectively, suggesting room for operational efficiency improvements.

Balance Sheet

Positive

The balance sheet reflects a significant improvement in stockholders' equity, shifting from negative in 2023 to positive in 2024. The debt-to-equity ratio stands at 2.28, indicating a moderate leverage level but improved equity position. The equity ratio has improved to 17.71%, though it remains below ideal levels, indicating a reliance on liabilities. Continued focus on reducing debt and improving equity is recommended.

Cash Flow

Positive

Cash flows have been robust with a strong operating cash flow to net income ratio of 11.21, reflecting efficient cash generation from operations. Free cash flow remains strong, although it showed a slight decrease from 2023. The improvement from negative net income to positive supports the cash flow strength, but cautious cash management is advised to maintain this trajectory.

Dec 2024	Dec 2023	Dec 2022	Dec 2021
Breakdown
Income Statement		Total Revenue
57.44B	44.08B	32.58B	23.09B
	Gross Profit
9.38B	7.04B	4.92B	3.44B
	EBIT
1.33B	793.86M	520.27M	394.05M
	EBITDA
3.49B	2.43B	820.41M	608.85M
	Net Income Common Stockholders
334.42M	-306.15M	-565.11M	-816.67M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
4.47B	1.22B	984.63M	1.00B
	Total Assets
22.78B	14.96B	11.79B	8.05B
	Total Debt
9.20B	11.91B	10.55B	8.13B
	Net Debt
7.79B	10.71B	9.57B	7.13B
	Total Liabilities
18.74B	19.60B	16.51B	12.50B
	Stockholders Equity
4.03B	-4.63B	-4.71B	-4.45B
Cash Flow		Free Cash Flow
1.31B	1.34B	990.65M	832.27M
	Operating Cash Flow
3.75B	3.14B	2.12B	1.37B
	Investing Cash Flow
-4.91B	-1.78B	-1.11B	-524.08M
	Financing Cash Flow
1.29B	-1.10B	-1.03B	-450.24M

BBB Foods, Inc. Class A Technical Analysis

Technical Analysis Sentiment

Negative

Last Price27.90

Price Trends

50DMA

26.99

Positive

100DMA

28.11

Negative

200DMA

29.25

Negative

Market Momentum

MACD

0.76

Positive

RSI

45.30

Neutral

STOCH

34.27

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TBBB, the sentiment is Negative. The current price of 27.9 is below the 20-day moving average (MA) of 28.89, above the 50-day MA of 26.99, and below the 200-day MA of 29.25, indicating a neutral trend. The MACD of 0.76 indicates Positive momentum. The RSI at 45.30 is Neutral, neither overbought nor oversold. The STOCH value of 34.27 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TBBB.

BBB Foods, Inc. Class A Peers Comparison

Overall Rating

UnderperformOutperform

Sector (56)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PSMT	79 Outperform	$3.21B	22.27	12.42%	1.16%	8.65%	17.76%
BJ	75 Outperform	$15.09B	28.65	32.33%	―	2.67%	2.72%
OLLI	72 Outperform	$6.52B	32.84	12.47%	―	8.04%	10.75%
TBBB	65 Neutral	$3.13B	―	6.61%	―	―	―
DG	65 Neutral	$20.16B	17.92	15.89%	2.57%	4.96%	-32.41%
DLTR	61 Neutral	$17.96B	―	18.88%	―	-9.88%	-205.57%
Sector *	56 Neutral	$4.46B	10.71	-18.54%	5.13%	17.31%	-65.85%

* General Sector Average

Performance Comparison

TBBB

BBB Foods, Inc. Class A

27.90

2.91

11.64%

Dollar General

91.66

-43.62

-32.24%

DLTR

Dollar Tree

85.47

-34.73

-28.89%

PSMT

Pricesmart

104.45

20.79

24.85%

OLLI

Ollie's Bargain Outlet Holding

106.17

31.67

42.51%

Bj's Wholesale Club Holdings

114.63

36.16

46.08%

BBB Foods, Inc. Class A Earnings Call Summary

Earnings Call Date:May 07, 2025

(Q4-2024)

% Change Since: -9.94%|

Next Earnings Date:Aug 20, 2025

Earnings Call Sentiment Positive

The earnings call reflects a strong performance by Tiendas Tres B, with significant revenue growth, store expansion, and increased private label penetration. Despite some increases in SG&A expenses, the overall financial position remains robust. The company's resilience in uncertain economic times and continuous operational improvements contribute to a positive outlook for 2025.

Q4-2024 Updates

Positive Updates

Strong Store Expansion

Tiendas Tres B opened 138 net new stores in the fourth quarter and a total of 484 new stores for the full year, representing a 21% increase over 2023.

Robust Revenue Growth

Total revenues for the fourth quarter increased by 32.7% to MXN16.3 billion, and full year revenues increased by 30.3% to MXN57.4 billion.

Impressive Same Store Sales Growth

Same store sales growth for the fourth quarter was 11.8% and 13.4% for the full year, outperforming ANTAD's numbers significantly.

Strong Cash Flow and Financial Position

Net cash flows generated by operating activities reached MXN3.749 million, a 19.4% increase year-over-year, ending the year with a net cash position of approximately MXN1.4 billion.

Increased Private Label Penetration

Private labels now represent 54% of sales, up from 47% in 2023, driving increased value and customer loyalty.

Negative Updates

Increased SG&A Expenses

SG&A expenses as a percentage of revenue increased by 96 basis points to 15.2% in Q4 2024, including non-recurring expenses related to legal matters and public company preparations.

Company Guidance

In the Tiendas Tres B fourth quarter and full year 2024 conference call, the company provided guidance for 2025, forecasting same-store sales growth between 11% and 14% and total revenue growth ranging from 26% to 29%. The company plans to open between 500 and 550 new stores. In 2024, Tiendas Tres B achieved significant growth, with total revenues increasing by 30.3% to MXN57.4 billion and same-store sales rising by 13.4% for the full year. EBITDA for the year reached MXN2.8 billion, representing a 5% margin and a 51% growth compared to 2023. The company ended the year with a net cash position of approximately MXN1.4 billion and maintained USD150 million from its IPO. Despite economic uncertainty, Tiendas Tres B remains confident in its strong value proposition and operational resilience.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

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.