MeritValue

BAB, INC.

BABBdata completeness 75%20 fiscal years on file
The thesis, from the filings

BAB, INC. earns about 40% on invested capital, with a roughly flat share count. The applicable estimate puts fair value near $0.75 a share.Whether it’s worth owning at today’s price is the last question — and yours to answer, below.

i. The business — what you’d actually own
FigureFY 2023FY 2023FY 2024FY 2024FY 2025
Revenue$3.51M1$3.51M1$3.55M2$3.55M1$3.44M2
Net income$525,2003$467,3214$525,2003$525,2004$559,0443
Operating cash flow$534,3665$534,3666$637,7537$637,7536$414,3887
Capital expenditure—————
Free cash flow (derived)—————
Total debt—————
Cash & equivalents$1.89M8—$2.18M9—$2.15M9
Diluted shares7.3M7.3M7.3M7.3M7.3M

Superscripts are receipts. Each links to the SEC filing the number came from (full list at the bottom).

ii. Your slice — ownership made literal
If you owned
shares
Net assets behind them
$4.77
your share of equity
Profit it earned you last year
$0.77
Free cash flow it threw off
—
Debt you’d be carrying
—

10 shares is a claim on $4.77 of net worth that earned you $0.77 last year.

iii. Is this a good business?
Moat signal · return on invested capital
40% avg · 5y
FY23 32%FY23 —FY24 45%FY24 —FY25 43%

It earned an average 40% on invested capital over 5 years. Compare that to what it costs to fund the business.

seeing a moat in the numbers →
Management signal · capital allocation
−0% shares · 5y

Share count is roughly flat over 5 years — little dilution, little buyback.

reading capital allocation →

Signals, not verdicts — read from the filings above. Numbers don’t prove a moat; they show its footprint. You decide.

iv. What it’s worth — engine v0.1.0
DCF · Growth Exit 10Y
not applicable
only 0 years of FCF (need ≥3) — model not applicable
DCF · Growth Exit 5Y
not applicable
only 0 years of FCF (need ≥3) — model not applicable
Earnings Power Value
$0.75
assumptions (8)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • normalizedEarnings$525,200
  • growthAssumed0.0%
Graham Number
not applicable
diluted EPS missing or non-positive — Graham Number undefined

Different models answer different questions — which to trust when →

Sources — the receipts
  1. 10-K · period ending 2023-11-30 · accession 0001437749-25-005215 (RevenueFromContractWithCustomerIncludingAssessedTax)
  2. 10-K · period ending 2024-11-30 · accession 0001437749-26-005227 (RevenueFromContractWithCustomerIncludingAssessedTax)
  3. 10-K · period ending 2023-11-30 · accession 0001437749-26-005227 (NetIncomeLoss)
  4. 10-K · period ending 2023-12-31 · accession 0001437749-25-005215 (NetIncomeLoss)
  5. 10-K · period ending 2023-11-30 · accession 0001437749-24-005487 (NetCashProvidedByUsedInOperatingActivities)
  6. 10-K · period ending 2023-12-31 · accession 0001437749-25-005215 (NetCashProvidedByUsedInOperatingActivities)
  7. 10-K · period ending 2024-11-30 · accession 0001437749-26-005227 (NetCashProvidedByUsedInOperatingActivities)
  8. 10-K · period ending 2023-11-30 · accession 0001437749-25-005215 (CashAndCashEquivalentsAtCarryingValue)
  9. 10-K · period ending 2024-11-30 · accession 0001437749-26-005227 (CashAndCashEquivalentsAtCarryingValue)