Company Overview
BT Brands, Inc. functions as an operator of fast-food establishments located within the north central region of the United States, specifically managing the Burger Time restaurant chain. The company's business model focuses on providing a diverse menu that includes various burgers, chicken sandwiches, pulled pork sandwiches, chicken tenders, chicken chunks, sides, and soft offerings. Operating within the Consumer Cyclical sector and the Restaurants industry, the firm's performance is intrinsically linked to consumer discretionary spending and regional dining preferences. As of the latest data, the entity maintains a market capitalization of $10.22M and employs approximately 40 individuals to support its operations. The annual revenue generated over the trailing twelve months is $14.04M, which, when combined with the market cap and headcount, indicates a small-cap profile typical of niche regional restaurant operators. These valuation and revenue figures suggest the company occupies a limited market position with a relatively modest scale compared to national fast-food chains, reflecting its regional footprint and the capital requirements associated with managing a small number of locations.
Financial Health
The company reported a revenue of $14.04M over the trailing twelve months, while posting a net income of -$935,920 and an EBITDA of $806. The significant disparity between the reported revenue of $14.04M and the net loss of -$935,920 reveals a cost structure where operating expenses, including taxes and interest, substantially erode profitability before arriving at the bottom line. Free cash flow stands at -$2,145,658, indicating that the business is currently burning cash, which limits its immediate financial flexibility and ability to fund organic expansion without external capital injections. Despite the negative net income, the gross margin sits at 18.2%, while the operating margin is 12.8% and the profit margin is -6.7%, highlighting that the company retains a healthy portion of revenue from sales but struggles to cover fixed costs and taxes effectively. The balance sheet shows a cash position of $4.74M against total debt of $3.74M, resulting in a debt-to-equity ratio of 48.47%, which suggests a moderately leveraged structure given the company's small size and negative earnings. However, the current ratio of 6.80 indicates strong short-term liquidity, as the company holds significantly more current assets than current liabilities, providing a buffer against immediate obligations. Return on equity is -11.5% and return on assets is -3.5%, metrics that reveal management has not yet achieved positive returns on the capital invested in the business, pointing to challenges in generating efficient earnings relative to the equity base and total asset utilization.
Valuation Assessment
Trailing P/E and forward P/E ratios are both listed as N/A due to the company's lack of positive earnings over the trailing twelve months, implying that traditional earnings-based valuation models cannot be applied to assess expected earnings trajectories. The price-to-book ratio is 1.32, indicating that the market values the company at a 32% premium over its book value, a metric that often reflects investor expectations of future growth or asset quality despite current profitability issues. Alternative valuation metrics such as the price-to-sales ratio of 0.73 and an EV/EBITDA of 11440.74 are presented, where the low price-to-sales ratio suggests the stock trades at a fraction of its revenue, while the extremely high EV/EBITDA multiple results from the minimal EBITDA figure relative to enterprise value. The stock has traded between a 52-week high of $5.60 and a 52-week low of $1.00, placing the current price significantly below the recent high and requiring calculation to determine the exact percentage discount from the peak. With a beta of 0.90, the stock exhibits price volatility that closely mirrors the broader market, suggesting it does not offer significant downside protection nor amplified upside compared to the S&P 500 index.
Growth & Income
Revenue growth year-over-year is -11.4%, while earnings growth is N/A due to the negative earnings position, implying that the company is currently contracting rather than expanding its top line or profitability. Because the company does not pay a dividend, evidenced by a dividend yield of N/A and a payout ratio of 0.0%, it effectively reinvests all available earnings—or in this case, relies on cash reserves—into growth initiatives rather than distributing income to shareholders. The absence of a dividend payout means the company relies entirely on operational improvement or asset sales to generate returns for investors, as there is no mechanism for returning cash directly to the equity base. Summarizing the overall profile, BT Brands, Inc. presents a growth and income scenario characterized by revenue contraction and a lack of dividend income, relying instead on potential future operational turnaround to alter its financial trajectory.