Build-A-Bear Workshop (BBW, Financial) shares surged nearly 16% today, reflecting strong quarterly results that beat analysts' expectations.
The company reported a revenue of just under $112 million for its second quarter, marking a 2% year-over-year increase. This surpassed the analyst estimates, which were slightly below $110 million. GAAP net income rose by 5% to almost $8.8 million, or $0.64 per share, beating the expected $0.59 per share.
The revenue growth was driven significantly by a nearly 45% rise in commercial and international franchise revenue, totaling $8.3 million. Core retail sales continue to be the primary source of revenue for Build-A-Bear.
Build-A-Bear Workshop (BBW, Financial) also reaffirmed its guidance for the full year of 2024, anticipating mid-single-digit percentage growth in both non-GAAP (adjusted) revenue and pre-tax income. The company plans to add at least 50 new experience locations and expects capital expenditures between $18 million and $20 million.
In terms of valuation, BBW's current stock price stands at $32.26, representing a 4.39% increase. With a market capitalization of $445.36 million and a P/E ratio of 9.24, the stock appears attractively priced. The company also boasts a strong financial position with an Altman Z-score of 4.88 and a Piotroski F-score of 9, indicating robust financial health.
Despite the surge, it is noteworthy that BBW is close to its 10-year high. The GF Value indicates that the stock is modestly overvalued at $25.89. For more details on GF Value, you can visit the [GF Value](https://www.gurufocus.com/term/gf-value/BBW) page.
Moreover, Build-A-Bear faces some caution signs, such as insider selling and its price-to-sales ratio being close to a 3-year high. However, the company's strategic direction and solid financial metrics make it a viable option for investors looking for growth in the specialty retail sector.
