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Baby Bunting Group Ltd. (AU:BBN)
ASX:BBN
Australian Market

Baby Bunting Group Ltd. (BBN) AI Stock Analysis

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AU

Baby Bunting Group Ltd.

(Sydney:BBN)

Rating:62Neutral
Price Target:
AU$2.00
▲(14.29%Upside)
The overall score reflects the financial challenges faced by Baby Bunting Group, including declining profitability and high leverage, balanced by strong cash flow. Technical indicators suggest moderate bullish momentum, but a high P/E ratio implies potential overvaluation risk.

Baby Bunting Group Ltd. (BBN) vs. iShares MSCI Australia ETF (EWA)

Baby Bunting Group Ltd. Business Overview & Revenue Model

Company DescriptionBaby Bunting Group Limited, together with its subsidiaries, operates as specialty retailer of maternity and baby goods in Australia. The company's principal product categories include prams, cots and nursery furniture, car safety, toys, babywear, feeding, nappies, and Manchester and associated accessories. Its products primarily cater to parents with children from newborn to three years of age, and parents-to-be. The company operates a network of 65 stores in Australia; and one store in New Zealand, as well as sells products through babybunting.com.au, an online store. Baby Bunting Group Limited was founded in 1979 and is based in Dandenong, Australia.
How the Company Makes MoneyBaby Bunting Group Ltd. generates revenue primarily through the retail sale of baby and maternity products via its network of physical stores and online e-commerce platform. The company's key revenue streams include the sale of branded and private-label products, which range from necessities like diapers and formula to larger items such as cots and strollers. Additionally, Baby Bunting benefits from exclusive distribution arrangements and strategic partnerships with suppliers, allowing them to offer unique products and competitive pricing. The company's loyalty program and gift registry services also contribute to customer retention and repeat sales, further bolstering its revenue.

Baby Bunting Group Ltd. Financial Statement Overview

Summary
Baby Bunting Group is experiencing pressures in revenue and profitability, reflected in declining margins and growth rates. The balance sheet indicates high leverage, which poses a risk if income does not improve. Despite these challenges, the cash flow situation remains relatively strong, providing a buffer against short-term financial volatility.
Income Statement
65
Positive
Baby Bunting Group has shown a decline in revenue over the past year, with a decrease from AUD 524.3 million to AUD 498.4 million, marking a negative revenue growth rate of -4.94%. Gross profit margin has decreased to 29.12% from 30.46%, indicating reduced profitability at the gross level. The net profit margin has also declined to 0.34% from 1.88%, reflecting a significant drop in net income. EBIT and EBITDA margins have contracted, suggesting tighter operating conditions and reduced operational efficiency.
Balance Sheet
70
Positive
The company's debt-to-equity ratio is relatively high at 1.74, indicating significant leverage. Return on equity (ROE) has decreased to 1.69% from 9.13%, largely due to lower net income. However, the equity ratio remains stable at around 30.28%, indicating a consistent proportion of equity financing relative to assets.
Cash Flow
75
Positive
Operating cash flow has slightly decreased but remains strong compared to net income, resulting in an operating cash flow to net income ratio of 23.62. Free cash flow to net income remains robust at 185.45%, suggesting healthy cash flow generation relative to profits. However, free cash flow has decreased from the previous year, indicating potential challenges in maintaining cash generation.
Breakdown
TTMJun 2024Jun 2023Jun 2022Jun 2021Jun 2020
Income StatementTotal Revenue
496.90M498.39M524.28M507.27M468.38M405.17M
Gross Profit
188.81M183.65M159.72M164.00M144.76M121.57M
EBIT
18.19M-24.16M28.71M39.96M34.02M30.64M
EBITDA
25.06M43.28M65.18M71.72M62.92M55.93M
Net Income Common Stockholders
6.21M1.70M9.85M19.52M17.53M9.99M
Balance SheetCash, Cash Equivalents and Short-Term Investments
6.77M9.53M5.00M12.24M10.88M13.34M
Total Assets
350.86M332.20M343.89M350.67M301.42M258.26M
Total Debt
181.52M175.41M175.56M169.18M135.24M105.98M
Net Debt
174.75M165.89M170.56M156.94M124.36M92.64M
Total Liabilities
247.64M231.58M235.95M235.95M193.66M164.89M
Stockholders Equity
103.22M100.62M107.93M114.72M107.76M93.37M
Cash FlowFree Cash Flow
32.44M31.45M34.21M39.75M24.81M41.53M
Operating Cash Flow
37.55M40.06M43.01M52.37M36.92M49.85M
Investing Cash Flow
-8.03M-8.60M-8.79M-12.62M-12.11M-8.32M
Financing Cash Flow
-24.30M-26.93M-41.45M-38.39M-27.26M-34.03M

Baby Bunting Group Ltd. Technical Analysis

Technical Analysis Sentiment
Positive
Last Price1.75
Price Trends
50DMA
1.66
Positive
100DMA
1.74
Positive
200DMA
1.73
Positive
Market Momentum
MACD
0.02
Negative
RSI
54.12
Neutral
STOCH
80.56
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AU:BBN, the sentiment is Positive. The current price of 1.75 is above the 20-day moving average (MA) of 1.73, above the 50-day MA of 1.66, and above the 200-day MA of 1.73, indicating a bullish trend. The MACD of 0.02 indicates Negative momentum. The RSI at 54.12 is Neutral, neither overbought nor oversold. The STOCH value of 80.56 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AU:BBN.

Baby Bunting Group Ltd. Peers Comparison

Overall Rating
UnderperformOutperform
Sector (62)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
62
Neutral
$6.88B11.322.95%3.87%2.70%-24.57%
AUBBN
62
Neutral
AU$236.11M81.402.78%1.03%-2.62%-70.47%
$4.44B15.549.58%4.45%
DE30M
€673.19M21.548.55%5.81%
AUSUL
73
Outperform
AU$3.21B14.1817.52%4.85%2.56%-13.62%
AUPMV
71
Outperform
AU$3.24B16.3514.01%6.57%-27.48%-27.96%
AUKMD
AU$197.60M-7.70%
* Consumer Cyclical Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
AU:BBN
Baby Bunting Group Ltd.
1.75
0.41
30.60%
HNORF
Harvey Norman Holdings Ltd
3.54
0.68
23.78%
DE:30M
Myer Holdings Limited
0.36
0.00
0.00%
AU:SUL
Super Retail Group Limited
14.22
1.93
15.70%
AU:PMV
Premier Investments Limited
20.25
-0.91
-4.30%
AU:KMD
KMD Brands Limited
0.28
-0.12
-30.00%

Baby Bunting Group Ltd. Corporate Events

Baby Bunting Strengthens Board with New Director Appointment
May 20, 2025

Baby Bunting Group Ltd. has appointed Debra Singh as an independent non-executive director and Chair of the Remuneration Committee, effective 21 May 2025. Singh’s extensive experience in retail operations and leadership roles is expected to enhance the board’s strategic oversight during a crucial growth phase, aligning with the company’s new strategy and expansion plans.

The most recent analyst rating on (AU:BBN) stock is a Buy with a A$1.70 price target. To see the full list of analyst forecasts on Baby Bunting Group Ltd. stock, see the AU:BBN Stock Forecast page.

Baby Bunting Unveils ‘Store of the Future’ Vision
May 1, 2025

Baby Bunting Group Ltd. presented its ‘Store of the Future’ concept during an investor day on May 1, 2025. The presentation outlined the company’s strategic vision for enhancing its retail operations, potentially impacting its market positioning and stakeholder interests. The company emphasized the importance of adapting to future market trends and consumer needs, although it acknowledged the inherent risks and uncertainties associated with forward-looking statements.

Baby Bunting Unveils ‘Store of the Future’ Amid Positive Sales Growth
Apr 30, 2025

Baby Bunting Group Ltd. has opened its ‘Store of the Future’ in Maribyrnong, Melbourne, designed to enhance customer experience and drive sales. The store’s innovative format has received positive feedback and is performing above expectations, with plans to use this model for future store developments. The company reports a 2.9% year-to-date increase in comparable store sales and a gross margin of 40%, reflecting improved sales momentum and strategic initiatives. Baby Bunting has adjusted its FY25 NPAT guidance upwards, anticipating continued growth supported by new product ranges, optimized pricing, and targeted marketing, with capital expenditure fully funded through operating cash flow.

Perpetual Limited Acquires Significant Stake in Baby Bunting
Apr 17, 2025

Perpetual Limited has become a substantial holder in Baby Bunting Group Limited, acquiring a 5.058% voting power with 6,824,184 ordinary shares. This acquisition reflects a significant investment in Baby Bunting, potentially impacting its market dynamics and signaling confidence in the company’s future prospects.

Macquarie Group Corrects Substantial Holder Notice for Baby Bunting
Apr 11, 2025

Baby Bunting Group Ltd. received a notice from Macquarie Group Limited correcting a previous filing error. The Macquarie Group clarified that they are not a substantial holder of Baby Bunting Group Ltd. shares, as previously indicated. This correction may impact stakeholders’ understanding of the company’s shareholder structure.

Macquarie Group Becomes Substantial Holder in Baby Bunting
Apr 10, 2025

Macquarie Group Limited has become a substantial holder in Baby Bunting Group Ltd., a company known for its retail operations in baby products. This development signifies Macquarie’s increased influence in the company, with a voting power of 16.27%, which could impact Baby Bunting’s strategic decisions and market positioning.

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.