ASX:BBN

Stock Analysis Report

Baby Bunting Group

Executive Summary

Baby Bunting Group Limited operates as specialty retailer of baby goods in Australia.


Snowflake Analysis

Solid track record with high growth potential.


Similar Companies

Share Price & News

How has Baby Bunting Group's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: BBN has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-0.8%

BBN

0.8%

AU Specialty Retail

0.7%

AU Market


1 Year Return

57.3%

BBN

39.8%

AU Specialty Retail

15.5%

AU Market

Return vs Industry: BBN exceeded the Australian Specialty Retail industry which returned 39.8% over the past year.

Return vs Market: BBN exceeded the Australian Market which returned 15.5% over the past year.


Shareholder returns

BBNIndustryMarket
7 Day-0.8%0.8%0.7%
30 Day-0.8%2.2%0.8%
90 Day1.4%6.5%6.1%
1 Year62.3%57.3%45.8%39.8%20.6%15.5%
3 Year78.2%61.5%35.5%18.3%38.1%19.7%
5 Yearn/a89.5%52.9%51.8%17.9%

Price Volatility Vs. Market

How volatile is Baby Bunting Group's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Baby Bunting Group undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: BBN (A$3.57) is trading below our estimate of fair value (A$7.5)

Significantly Below Fair Value: BBN is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: BBN is poor value based on its PE Ratio (36.3x) compared to the Specialty Retail industry average (16.8x).

PE vs Market: BBN is poor value based on its PE Ratio (36.3x) compared to the Australian market (18.6x).


Price to Earnings Growth Ratio

PEG Ratio: BBN is poor value based on its PEG Ratio (1.2x)


Price to Book Ratio

PB vs Industry: BBN is overvalued based on its PB Ratio (4.9x) compared to the AU Specialty Retail industry average (2.4x).


Next Steps

Future Growth

How is Baby Bunting Group forecast to perform in the next 1 to 3 years based on estimates from 3 analysts?

29.5%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: BBN's forecast earnings growth (29.5% per year) is above the savings rate (1.1%).

Earnings vs Market: BBN's earnings (29.5% per year) are forecast to grow faster than the Australian market (9.3% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: BBN's revenue (10.6% per year) is forecast to grow faster than the Australian market (4.1% per year).

High Growth Revenue: BBN's revenue (10.6% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: BBN's Return on Equity is forecast to be high in 3 years time (23%)


Next Steps

Past Performance

How has Baby Bunting Group performed over the past 5 years?

12.4%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: BBN has high quality earnings.

Growing Profit Margin: BBN's current net profit margins (3.3%) are higher than last year (2.8%).


Past Earnings Growth Analysis

Earnings Trend: BBN's earnings have grown by 12.4% per year over the past 5 years.

Accelerating Growth: BBN's earnings growth over the past year (32.6%) exceeds its 5-year average (12.4% per year).

Earnings vs Industry: BBN earnings growth over the past year (32.6%) exceeded the Specialty Retail industry -2.3%.


Return on Equity

High ROE: BBN's Return on Equity (13.4%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Baby Bunting Group's financial position?


Financial Position Analysis

Short Term Liabilities: BBN's short term assets (A$96.7M) exceed its short term liabilities (A$82.4M).

Long Term Liabilities: BBN's short term assets (A$96.7M) do not cover its long term liabilities (A$104.4M).


Debt to Equity History and Analysis

Debt Level: BBN's debt to equity ratio (22.7%) is considered satisfactory.

Reducing Debt: BBN's debt to equity ratio has increased from 11.9% to 22.7% over the past 5 years.

Debt Coverage: BBN's debt is well covered by operating cash flow (75.6%).

Interest Coverage: BBN's interest payments on its debt are well covered by EBIT (25.9x coverage).


Balance Sheet

Inventory Level: BBN has a high level of physical assets or inventory.

Debt Coverage by Assets: BBN's debt is covered by short term assets (assets are 4.6x debt).


Next Steps

Dividend

What is Baby Bunting Group's current dividend yield, its reliability and sustainability?

2.58%

Current Dividend Yield


Upcoming Dividend Payment

TodayFeb 22 2020Ex Dividend DateFeb 27 2020Dividend Pay DateMar 13 202015 days from Ex DividendBuy in the next 5 days to receive upcoming dividend

Dividend Yield vs Market

Notable Dividend: BBN's dividend (2.58%) is higher than the bottom 25% of dividend payers in the Australian market (2.3%).

High Dividend: BBN's dividend (2.58%) is low compared to the top 25% of dividend payers in the Australian market (5.35%).


Stability and Growth of Payments

Stable Dividend: BBN has been paying a dividend for less than 10 years and during this time payments have been volatile.

Growing Dividend: BBN's dividend payments have increased, but the company has only paid a dividend for 4 years.


Current Payout to Shareholders

Dividend Coverage: With its high payout ratio (93.6%), BBN's dividend payments are not well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: BBN's dividends in 3 years are forecast to be covered by earnings (66.1% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

6.4yrs

Average management tenure


CEO

Matt Spencer 0

8yrs

Tenure

AU$1,162,371

Compensation

Mr. Matthew Spencer, also known as Matt, has been the Chief Executive Officer and Managing Director of Baby Bunting Group Limited since February 2012 and has been its Director since April 23, 2012. 


CEO Compensation Analysis

Compensation vs Market: Matt's total compensation ($USD768.61K) is about average for companies of similar size in the Australian market ($USD689.90K).

Compensation vs Earnings: Matt's compensation has increased by more than 20% in the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Matthew Spencer
CEO, MD & Director8yrsAU$1.16m1.23% A$5.6m
Darin Hoekman
CFO & Company Secretary6.1yrsAU$745.45k0.30% A$1.4m
Michael Pane
General Manager of Operations0yrsno datano data
Corey Lewis
Group Legal Counsel & Company Secretary4yrsno datano data
Scott Teal
General Manager of Merchandise & Marketing6.8yrsno datano data
Sandy Nikakis
General Manager of Human Resources0yrsno datano data

6.4yrs

Average Tenure

Experienced Management: BBN's management team is seasoned and experienced (6.4 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Matthew Spencer
CEO, MD & Director8yrsAU$1.16m1.23% A$5.6m
Gary Levin
Independent Non-Executive Director5.5yrsAU$88.98k0.16% A$714.0k
Gary Kent
Independent Non-Executive Director1.2yrsAU$47.18k0.012% A$53.6k
Ian Cornell
Independent Non-Executive Chairman3.3yrsAU$138.64k0.71% A$3.2m
Donna Player
Independent Non-Executive Director3.1yrsAU$80.03k0.028% A$128.5k
Melanie Wilson
Independent Non-Executive Director4yrsAU$95.32k0.016% A$71.4k

3.6yrs

Average Tenure

Experienced Board: BBN's board of directors are considered experienced (3.6 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Baby Bunting Group Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Baby Bunting Group Limited
  • Ticker: BBN
  • Exchange: ASX
  • Founded: 1979
  • Industry: Specialty Stores
  • Sector: Retail
  • Market Cap: AU$455.405m
  • Shares outstanding: 127.56m
  • Website: https://www.babybuntingcorporate.com.au

Number of Employees


Location

  • Baby Bunting Group Limited
  • 955 Taylors Road
  • Dandenong South
  • Victoria
  • 3175
  • Australia

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
BBNASX (Australian Securities Exchange)YesOrdinary SharesAUAUDOct 2015
BBNCHIA (Chi-X Australia)YesOrdinary SharesAUAUDOct 2015
B14DB (Deutsche Boerse AG)YesOrdinary SharesDEEUROct 2015

Biography

Baby Bunting Group Limited operates as specialty retailer of 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 53 stores, 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 South, Australia. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/21 10:50
End of Day Share Price2020/02/21 00:00
Earnings2019/12/29
Annual Earnings2019/06/30


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.