BAB

BABB

Food Confectioners · Consumer Defensive

Winston Score

Winston is happy

A high-quality business with solid fundamentals.

Data as of Aug 23, 2026 · filings through May 31, 2026

How the score breaks down

Quality

Exceptional

Growth

Mixed

Cash Flow

Strong

Stability

Exceptional

Valuation

Good

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Winston Score History

The full picture

BAB, Inc. is a small franchisor based in the United States that operates the Big Apple Bagels brand. The company sells franchises to independent business owners who run bagel shops and café-style restaurants serving bagels, muffins, coffee, and sandwiches to everyday consumers. It also owns the My Favorite Muffin brand, giving it a small portfolio of quick-service food concepts.

BAB makes money primarily by collecting franchise fees and royalties from its network of franchisees rather than owning and operating stores itself. This asset-light model explains the unusually high gross margin. The company is very small, with operations concentrated in the United States and a franchise count that has declined over the years. The main risk is continued shrinkage of its franchise network, as the brand competes against much larger chains like Panera and Dunkin' in a crowded breakfast and café market where smaller concepts often struggle to attract new franchisees.

Growth Profile

For growth stock investors

When traditional metrics don't capture the full picture, these are the signals growth stock investors use instead.

Revenue Growth

-0.6% YoY

YoY Growth Rate

Revenue declining

EPS Growth

+21.2% YoY

YoY Growth Rate

Steady EPS growth

Insider Activity

35.4%ownership

↑ Rising

Insiders increasing their stake — aligned with shareholders

Cash Position

Cash flow positive

$2M cash & investments

Quarterly Free Cash Flow

→ Burn rate stable

Company generates more cash than it spends — no dilution risk from fundraising

Revenue declining

BAB's revenue is actually shrinking. In a growth stock, that removes the core investment thesis. The low Winston Score here may be warranted — unless there's a turnaround story.

The Winston Score above measures business quality today. Growth stocks often score lower because they invest in the future rather than maximising current profits. These metrics show what matters most for evaluating that future.

Score breakdown

Every number that matters to educated investors.

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Quality

Profit per sale

Gross Margin

98.4%

Premium pricing power — 98.4% gross margin

Profit after running costs

Operating Margin

30.8%

Excellent — 30.8% operating margin

Return on the money invested

ROCE

21.4%

Exceptional — 21.4% return on capital

ROIC between 15% and 25%. Every dollar invested in the business earns 15 to 25 cents back per year.

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Growth

Sales growth

Sales YoY

+0.3%

Nearly flat sales (+0.3% YoY)

Profit growth

EPS YoY

+7.8%

Modest earnings growth (+7.8% YoY)

Single-digit earnings growth — steady but not exciting.

How steady the profit is

EPS Consistency

5/8 quarters

Mixed — about half the quarters showed growth

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Cash Flow

Profit that turns into cash

Cash Conversion

100%

Turns 100% of profit into real cash

Spare cash per sale

FCF Margin

17.0%

Converts sales into free cash efficiently (17.0%)

FCF margin between 10% and 20%. Every $100 in sales becomes $10 to $20 in real cash.

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Stability

What it owes vs what it owns

Debt / Equity

0.02

Conservative — low debt load (0.02)

Covers its interest

Interest Cover

100.00x

—

Comfortably covers interest (100.0x)

Interest coverage above 8. Profits cover interest many times over.

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Valuation

Price vs profit

P/E Ratio (TTM)

10.8x

no trend

Attractive valuation — P/E 10.8

P/E in the normal range. Price is roughly $15 for every $1 of yearly profit.

Cheaper or dearer next year

P/E vs Forward

N/A

not available

Data not available

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Dividends

Not applicable for this business.

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