Baby Bunting Group Ltd. (BBN) AI Stock Analysis

• Market Cap: AU$335.79M
• Dividend Yield: N/A
• Average Volume (3M): 315.55K
• Price to Earnings (P/E): 35.1
• Beta (1Y): 1.38
• Revenue Growth: 4.72%
• EPS Growth: 465.60%
• Country: US
• Employees: 1,590
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Specialty Retail
• EPS (TTM): 0.05
• Shares Outstanding: 135,400,730
• 10 Day Avg. Volume: 441,528
• 30 Day Avg. Volume: 315,554
• PEG Ratio: 0.02
• Price to Book (P/B): 2.20
• Price to Sales (P/S): 0.48
• P/FCF Ratio: 6.36
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: AU$2.70
• Price Target Upside: 9.76% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 1
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 56 Neutral
• Price Target: AU$2.50 ▲(1.63% Upside)

The overall stock score of 56 reflects the company's solid revenue growth and cash flow generation, which are offset by challenges in profitability and high leverage. Technical indicators suggest bearish momentum, and the stock appears overvalued with a high P/E ratio and no dividend yield. The absence of earnings call data and corporate events leaves these areas unaddressed.

Positive Factors

Revenue Growth Trend

Consistent revenue growth, including a recent ~5% increase, indicates steady demand and sustained market penetration in baby goods. Over a 2–6 month horizon this supports scale economies, steadier inventory turnover and reliable cash flows to fund selective store and e-commerce investment.

Improved Gross Margins

A roughly 10 percentage point improvement in gross margin reflects better sourcing, pricing or product mix control. Sustained higher gross margins create a structural buffer against input cost inflation, enabling the company to absorb promotional periods and invest in customer experience without eroding long-term profitability.

Free Cash Flow Growth

Free cash flow growth of ~20% shows strong cash conversion and operational cash generation. Durable FCF supports debt servicing, funding of capex and store openings or digital investment without reliance on equity, improving financial flexibility and resilience over several months.

Negative Factors

High Leverage

A debt-to-equity ratio near 1.5 indicates significant leverage, raising refinancing and interest-rate risk. High leverage constrains strategic flexibility, magnifies earnings volatility in retail downturns, and can limit the company’s ability to invest or respond to sustained margin pressure over the coming months.

Weak Profitability

Very low net margin and negative EBIT point to persistent operational strain—likely from fixed costs, promotions or inefficiencies. If operating margins do not recover, the business will have limited internal funds for reinvestment, making it harder to reduce leverage or sustainably improve returns.

Declining Return on Equity

ROE falling to ~8.5% indicates the company is generating lower returns on shareholder capital. Combined with high leverage, this suggests capital is being deployed less efficiently, which can constrain shareholder value creation and make it harder to justify new capital deployment absent material operational improvements.

Baby Bunting Group Ltd. Business Overview & Revenue Model

Company Description

Baby 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 Money

Baby Bunting generates revenue primarily through the sale of baby and parenting products in its retail stores and online. The company employs a multi-channel retail strategy, allowing customers to shop in-store or online, which broadens its customer reach. Key revenue streams include direct sales of merchandise, offering exclusive brands, and possibly online subscriptions for baby-related services. Additionally, partnerships with suppliers and manufacturers enable Baby Bunting to negotiate favorable terms, enhancing profit margins. Seasonal promotions and loyalty programs also contribute to revenue by encouraging repeat business among customers.

Baby Bunting Group Ltd. Financial Statement Overview

Summary

Baby Bunting Group Ltd. demonstrates solid revenue growth and improved gross margins, but faces challenges with profitability and leverage. The company shows strong cash flow generation, which is a positive sign for future investments and debt management. However, the high debt levels and negative EBIT margins could pose risks if not addressed.

Income Statement

The company has shown a consistent revenue growth trend over the years, with a recent 5.04% increase. Gross profit margins have improved from 30.47% to 40.17%, indicating better cost management. However, the net profit margin remains low at 1.83%, and EBIT margins have turned negative, suggesting challenges in operational efficiency.

Balance Sheet

The debt-to-equity ratio is relatively high at 1.48, indicating significant leverage, which could pose risks in a volatile market. Return on equity has decreased to 8.47%, reflecting reduced profitability. The equity ratio is stable, suggesting a balanced asset structure.

Cash Flow

Free cash flow has grown by 20.14%, showing strong cash generation capabilities. The operating cash flow to net income ratio is 0.53, indicating decent cash conversion efficiency. However, the free cash flow to net income ratio has slightly decreased, suggesting potential cash flow management issues.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	521.93M	521.93M	498.39M	524.28M	507.27M	468.38M
Gross Profit	189.50M	209.66M	183.65M	159.72M	164.00M	144.76M
EBITDA	47.16M	56.11M	43.28M	65.18M	67.05M	62.92M
Net Income	9.54M	9.54M	1.70M	9.85M	19.52M	17.53M
Balance Sheet
Total Assets	340.41M	340.41M	332.20M	343.89M	350.67M	301.42M
Cash, Cash Equivalents and Short-Term Investments	12.38M	12.38M	9.53M	5.00M	12.24M	10.88M
Total Debt	166.42M	166.42M	175.41M	175.56M	169.18M	135.24M
Total Liabilities	227.76M	227.76M	231.58M	235.95M	235.95M	193.66M
Stockholders Equity	112.64M	112.64M	100.62M	107.93M	114.72M	107.76M
Cash Flow
Free Cash Flow	43.39M	38.97M	31.45M	34.21M	39.75M	24.81M
Operating Cash Flow	51.89M	51.89M	40.06M	43.01M	52.37M	36.92M
Investing Cash Flow	-12.92M	-12.92M	-8.60M	-8.79M	-12.62M	-12.11M
Financing Cash Flow	-36.12M	-36.12M	-26.93M	-41.45M	-38.39M	-27.26M

Baby Bunting Group Ltd. Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 2.46
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AU:BBN, the sentiment is Neutral. The current price of 2.46 is below the 20-day moving average (MA) of 2.50, below the 50-day MA of 2.61, and above the 200-day MA of 2.30, indicating a neutral trend. The MACD of -0.04 indicates Positive momentum. The RSI at 46.32 is Neutral, neither overbought nor oversold. The STOCH value of 33.44 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for AU:BBN.

Baby Bunting Group Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ABY	66 Neutral	AU$110.87M	145.68	1.90%	―	1.58%	-65.09%
DSK	66 Neutral	AU$56.04M	12.73	12.71%	9.03%	8.39%	3.21%
SSG	65 Neutral	AU$200.45M	13.35	16.91%	6.98%	-0.35%	-1.96%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
ADH	58 Neutral	AU$315.66M	12.18	11.70%	5.85%	3.99%	-18.35%
BBN	56 Neutral	AU$335.79M	35.08	8.94%	―	4.72%	465.60%
KGN	47 Neutral	$385.55M	-9.89	-40.52%	4.00%	6.24%	-23341.18%

Baby Bunting Group Ltd. Corporate Events

Baby Bunting Sets Date for 1H FY26 Results Release and Investor Briefing

Baby Bunting Group Limited has announced it will release its financial results for the half-year ended 29 December 2025 on Tuesday, 17 February 2026. Following the results announcement, CEO Mark Teperson and CFO Darin Hoekman will host an investor presentation and discussion at 9:15am AEDT on the same day, providing stakeholders with an opportunity to gain further insight into the company’s first-half performance and outlook.

The most recent analyst rating on (AU:BBN) stock is a Hold with a A$2.70 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 Announces Director’s Interest Change

Baby Bunting Group Ltd. announced a change in the director’s interest notice, specifically involving Mark Teperson. On October 30, 2025, Teperson was granted 417,908 share rights as part of the deferred component of the FY25 Short Term Incentive payment, which was previously approved by shareholders. This change reflects the company’s ongoing commitment to aligning executive incentives with shareholder interests, potentially impacting the company’s governance and stakeholder confidence.

The most recent analyst rating on (AU:BBN) stock is a Hold with a A$3.00 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 Group Ltd. Issues Unquoted Share Rights to Boost Employee Engagement

Baby Bunting Group Ltd. announced the issuance of 1,443,173 unquoted share rights as part of an employee incentive scheme. This move is aimed at enhancing employee engagement and aligning their interests with the company’s growth objectives, potentially impacting the company’s operational dynamics and stakeholder relations positively.

The most recent analyst rating on (AU:BBN) stock is a Hold with a A$3.00 price target. To see the full list of analyst forecasts on Baby Bunting Group Ltd. stock, see the AU:BBN Stock Forecast page.