Build-A-Bear Workshop Inc (BBW) stock analysis

P/E below its 5-year median

Build-A-Bear Workshop's P/E of 7.1 is below its own 5-year median of 8.0.

P/E below the industry

Build-A-Bear Workshop's P/E of 7.1 is below the Miscellaneous Retail median of 17.9.

EV/EBITDA below its 5-year median

Build-A-Bear Workshop's EV/EBITDA of 4.1 is below its 5-year median of 4.7.

P/B above the industry

Build-A-Bear Workshop's price-to-book of 2.22 is above the Miscellaneous Retail median of 2.09.

Trading below fair value

The share price of $28.69 is below our fair value estimate of $50.42.

Margin of safety over 20%

The price is 43.1% below fair value, more than the 20% cushion we look for.

Revenue growing under 10% a year

Revenue grew 4.2% a year over the last three fiscal years, short of the 10% we look for.

EPS growing under 10% a year

Diluted EPS grew 8.2% a year over the last three fiscal years.

Earnings acceleration

Needs positive net income now, a year ago and five years ago.

Growing slower than the industry

Revenue grew -0.9% over the last twelve months; the Miscellaneous Retail median is 4.4%.

Guidance lowered

Build-A-Bear Workshop lowered its fiscal 2026 Total revenues outlook on Aug 27, 2026.

Gross margin improving

Gross margin was 56.7% over the last twelve months, against 56.3% a year earlier.

Return on equity over 15%

Return on equity was 32.8% over the last twelve months and averaged 44.1% over five years.

Return on invested capital

Needs operating income and invested capital.

Return on equity above the industry

Build-A-Bear Workshop's return on equity of 32.8% is above the Miscellaneous Retail median of 18.5%.

Earnings over 5 years

Needs positive net income five years ago and in the latest year.

Net margin below its 5-year average

Net margin was 10.0% over the last twelve months, against a 5-year average of 10.6%.

Net margin above the industry

Build-A-Bear Workshop's net margin of 10.0% is above the Miscellaneous Retail median of 4.0%.

No debt

Build-A-Bear Workshop has no borrowings on its latest balance sheet.

Debt not rising

With no debt today, leverage cannot have risen.

Debt covered by cash flow

There is no debt to cover.

Interest well covered

No meaningful interest expense to cover.

Short-term assets cover short-term debts

Current assets are 1.60 times current liabilities.

Low bankruptcy risk

The Altman Z-score is 3.39; above 3 is the safe zone and below 1.8 the distress zone.

Pays a dividend

Build-A-Bear Workshop paid dividends worth 3.2% of the share price over the last twelve months.

Yield below Treasuries

The 3.2% yield is below the 4.4% on a 1-year Treasury.

Yield below the top quarter

The top quarter of US dividend payers yield 3.8% or more; Build-A-Bear Workshop yields 3.2%.

Dividend stability

Fewer than five years of dividend history.

Covered by earnings

Dividends take 22.2% of net income.

Covered by free cash flow

Dividends take 46.7% of free cash flow.