BBB Foods Inc. — financial distress indicators
Financial-health summary
BBB Foods Inc.'s reported numbers place it in the 'Weak' financial-health band (distress score 61/100). The main indicators are operating profit does not cover interest, severe working-capital shortfall and very high leverage. Independently, the Ohlson accounting model puts its 1-year failure probability at 77% and the market-implied (Merton) default probability is 0.0%. In its favour: operating cash flow is positive over the latest 12 months.
Stress by dimension
Share price — last 12 months
Indicators behind the score
Each red flag shows the evidence from the company’s own filings and the financial or legal principle behind it. Points add to the 0–100 score.
Interest coverage (EBIT / interest) is -0.60×.
When EBIT < interest, debt service is funded from cash reserves or new borrowing — the classic precursor to payment default and covenant breach.
Current ratio is 0.60 (current assets cover 60% of near-term obligations).
Cash-flow insolvency test: inability to pay debts as they fall due is the trigger for both U.S. involuntary petitions and Indian IBC default.
Total debt is 16.9× EBITDA.
Debt above ~6× EBITDA is deep sub-investment-grade territory; refinancing becomes difficult when rates or earnings move against the company.
O-score 1.19 → model probability 77%.
Ohlson (1980) logit model of 1-year corporate failure; O > 0 (p > 50%) is the original failure cut-off.
Recurring net losses.
Repeated losses are a core input in both Ohlson and Altman failure models.
Short-term debt is 2.4× cash on hand.
Maturity wall: debt due within a year must be refinanced, which is the most common proximate cause of filings.
Revenue vs net income
Cash generation
Debt vs cash vs equity
✅ Mitigating factors
- Operating cash flow is positive over the latest 12 months.
- Revenue still growing (+36% YoY).
📰 Recent news scan
- TBBB261120C00050000 Interactive Stock Chart | TBBB Nov 2026 50.000 call Stock - Yahoo FinanceGoogle News · 2026-10-07
- Eleva Capital SAS Acquires 166,147 Shares of BBB Foods Inc. $TBBB - MarketBeatGoogle News · 2026-10-06
- The Technical Signals Behind (TBBB) That Institutions Follow - Stock Traders DailyGoogle News · 2026-10-06
- October 2026's Top Insider Picks For Growth - Simply Wall StreetGoogle News · 2026-10-06
- BBB Foods (TBBB) Stock Looks Fully Valued After A 91% Run - Yahoo FinanceGoogle News · 2026-08-20
- TBBB Stock Jumps As BBB Foods Delivers Big Q2 Beat - StocksToTradeGoogle News · 2026-08-13
⚖️ U.S. legal pathway — Title 11, U.S. Code
Which chapter would apply?
- Chapter 11 — reorganisation. Management usually stays in control as debtor-in-possession; the automatic stay (§362) halts collection; a plan must meet the best-interests test (§1129(a)(7)) and the absolute priority rule (§1129(b)) — creditors are paid before shareholders, who are frequently wiped out.
- Chapter 7 — liquidation. A trustee sells assets and distributes proceeds by statutory priority (§§507, 726).
- Subchapter V (“Chapter 5”) is a fast track for small-business debtors under a statutory debt cap, but SEC-reporting companies are excluded (§101(51D)) — so it rarely applies to listed companies.
What typically triggers a filing
- Payment default or covenant breach lenders will not waive; a debt maturity that cannot be refinanced.
- Auditor going-concern doubt (ASC 205-40 / PCAOB AS 2415) — often itself a default trigger in loan agreements.
- Creditors can force a case with an involuntary petition (§303) if debts are not paid as they come due.
- Delisting after sustained sub-$1 prices or equity deficits cuts off equity funding.
Transactions shortly before filing can be clawed back (preferences — 90 days, §547; fraudulent transfers — 2 years, §548).
Frequently asked questions
What do BBB Foods Inc.'s financial-health indicators show?
As of 2026-10-08, BBB Foods Inc.'s public financial data places it in the 'Weak' band with a distress score of 61/100, driven by operating profit does not cover interest, severe working-capital shortfall and very high leverage. This is a statistical screen of reported numbers — it does not mean the company is insolvent, has defaulted or will enter insolvency proceedings.
What is BBB Foods Inc.'s financial distress score?
61/100 ('Weak'). Ohlson O-score 1.19 (model 1-year failure probability 77%). Merton distance-to-default 5.48 σ (model default probability 0.0%).
What works in BBB Foods Inc.'s favour?
Operating cash flow is positive over the latest 12 months. Revenue still growing (+36% YoY).
How are shareholders treated if a company enters insolvency?
In a Chapter 11 reorganisation the absolute priority rule pays secured lenders, then unsecured creditors, before shareholders — so existing shares are usually cancelled or heavily diluted. In Chapter 7 the company is liquidated and shareholders rarely recover anything.
Other Consumer Staples companies with distress indicators
- AMASS Brands, Inc. (AMSS)Very weak 100/100
- Borealis Foods Inc. (BRLS)Very weak 100/100
- Reed's, Inc. (REED)Very weak 100/100
- Sadot Group Inc. (SDOT)Very weak 100/100
- Rocky Mountain Chocolate Factory, Inc. (RMCF)Very weak 97/100
- Sow Good Inc. (SOWG)Very weak 97/100
Methodology
Score = capped sum of rule-based red flags across seven dimensions (liquidity, solvency, profitability, cash flow, sales trend, market signal, news). Ohlson O-score (1980) gives an accounting-based 1-year failure probability; Merton distance-to-default (Bharath & Shumway 2008) gives a market-implied probability. Financial institutions use a capital-based rule set. Recalculated every trading day from the latest filings, prices and news.