Episode Details

BBB Foods (TBBB) Q2 2026 — BBB Foods is a foreign private issuer, so the 2Q26 release arrived on a Form 6-K, not an 8-K. It cleared EDGAR at 4:30pm ET on August 12, AFTER the close, so August 13 was the reaction session: the shares opened +8.2 pct and closed +16.31 pct at USD49.20, the highest close of the twelve-month window, on 4.4x average volume. They eased to USD47.79 on August 14. Everything is reported in Mexican pesos (Ps.) under IFRS. Tiendas 3B is Mexico's leading grocery hard discounter: 3,624 stores, 21 distribution centres and 29,202 staff. The quarter was excellent - revenue up 38.7 pct to Ps. 26,037M, same-store sales up 20.0 pct, 155 net new stores. But the release carries TWO EBITDA growth rates: 13.8 pct on the income statement, 43.8 pct excluding a Ps. 615M non-cash share-based charge. That charge is settled in real shares, and the company says so itself. THE CALL: AVOID (3/5, MEDIUM - AN EXCELLENT BUSINESS, PRICED ON A SHARE COUNT THAT IS 42 PCT TOO SMALL) — base-case value ~$39.58 vs ~$47.79 today. KEY METRICS: - CALL: AVOID, 3/5. Fair value USD39.58 against the USD47.79 close, -17.2 pct. Bear USD23.37 / base USD39.58 / bull USD58.08, weighted 50/30/20 across an exit-multiple road, a free-cash-flow DCF and a sales multiple. All three roads land within a dollar of each other; the disagreement is with the share count, not the method. - THE PRINT: total revenue Ps. 26,037M, up 38.7 pct year on year, decomposing as 20.0 pct same-store sales compounded with about 15.6 pct from the wider network. Gross margin expanded 54 bps to 16.8 pct. 155 net new stores took the base to 3,624, and a new distribution centre took the logistics network to 21. - THE TWO EBITDA NUMBERS: reported EBITDA Ps. 960M, up 13.8 pct. Excluding a Ps. 615M non-cash share-based payment charge it is Ps. 1,575M, up 43.8 pct. The charge itself rose 143.8 pct. Administrative expense rose 95.3 pct, and even stripping the charge out it still rose 69.8 pct to Ps. 813M. - THE SHARE COUNT: Appendix 1 of the release gives 121,187,774 shares outstanding and, on the company's own net-settlement method run at the USD47.79 close, 164.7M fully diluted. The data vendor carries 115.9M. So market value is USD7.87bn, not the USD5.54bn a screen prints - 42 pct larger at the same share price. - THE MULTIPLE: enterprise value on the fully diluted count is Ps. 143.6bn, which is 28.8x trailing EBITDA before the charge and 1.58x sales on a 5.48 pct trailing margin. On the screen share count the same company looks like 20.8x. A third of the multiple vanishes purely because the denominator is wrong. - STORE ECONOMICS, AND THEY ARE GOOD: revenue per store reached Ps. 7.34M a quarter, up 15.8 pct from Ps. 6.34M. Stores per distribution centre FELL to 173 from 189, so logistics runs ahead of the build. Operating cash flow was Ps. 2,325M; after all capital spending and every peso of lease payment, free cash flow was Ps. 675M. - THE STREET: 14 firms cover it, 11 positive. Six published targets - UBS USD51 (Aug 4), Citigroup USD49 (Jul 31), Scotiabank USD48 (May 5), HSBC USD47 (May 27), Morgan Stanley USD46 (Jan 28), Itau BBA USD42 (Mar 13). The average is USD47.17 and NOT ONE postdates the print. The tape closed above that average on the reaction day. What to watch: UP: same-store sales holding near 20 pct for two more quarters, or the margin before the charge clearing 7 pct, which brings our USD58.08 bull case within reach of the tape. DOWN: the same-store line fading toward the mid-teens while capital keeps going out of the door, or any fresh equity grant that resets the schedule in Appendix 2 of the release. Also on YouTube: @ChargedAlpha DISCLAIMER: For informational and educational purposes only. Not financial advice. Do your own research before any investment decision. Learn investing free in the Charged Alpha app: https://chargedalpha.com/app?source=youtube&ref=video Educational only. Not financial advice.