Bob's Discount Furniture Inc. Common Stock (BOBS)

FairStock Score: 60/100 — STEADY

Key Financials

Strengths

• Generates $27 million in annual free cash flow (1.7% yield on market cap)
• Strong Piotroski F-Score of 7/9 indicating robust financial health across profitability, leverage, and efficiency metrics
• High return on equity of 38.8% demonstrating efficient capital deployment

Concerns

• Trades significantly above Graham Number ($5) with negative 130% margin of safety—limited downside protection
• High leverage at 7.19x debt-to-equity increases financial risk and interest expense burden
• Altman Z-Score of 1.0 places it in the financial distress zone—elevated bankruptcy risk

AI Analysis

Bob's Discount Furniture Inc. Common Stock is a micro-cap consumer cyclical company valued at $1.5 billion. The business generates $2.4 billion in annual revenue with a 1.7% net margin and $27 million in free cash flow. From a quality standpoint, Bob's shows solid Piotroski F-Score of 7/9 and distressed Altman Z-Score of 1.0 warrants caution. On valuation, the stock is attractively valued at 12.1x earnings, with trades far above its Graham Number ($5) with no margin of safety. Growth dynamics show revenue growing at 8.2% and profit growth of 6.2%. Our composite FairStock Score of 60/100 reflects above-average fundamentals overall. Investors should weigh the business quality against the current price and their own margin of safety requirements.

Bull Case

The market underappreciates Bob's's consistent 39% ROE at just 12x earnings—a re-rating toward sector peers could unlock 30-50% upside. With $27 million in annual free cash flow (1.7% yield), management has ample capital for buybacks, dividends, or accretive acquisitions.

Bear Case

Elevated leverage at 7.2x D/E means rising interest rates or revenue weakness could strain debt covenants and force asset sales at distressed prices. Regulatory changes, input cost inflation, or demand normalization represent underappreciated risks that could materially impact forward estimates.

Data from SEC filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer