Why BBB Foods Stock Is Skyrocketing Higher Today
Key Points
Sales and adjusted EBITDA rose 39% and 44% during the second quarter.
This revenue growth wasn't just expansion-driven, as same-store sales also increased by 20%.
Management believes the company can still quadruple its store count in the long run.
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Shares of Mexican hard discount grocer BBB Foods (NYSE: TBBB) soared 14% higher Thursday as of 1 p.m. ET after the company reported second-quarter earnings after market close yesterday. While the company reported a larger-than-expected net loss, its sales rose 39%, easily surpassing Wall Street's top-line estimates and prompting today's share price rise.
Home to 3,624 Tiendas 3B stores (which stands for Bueno, Bonito, and Barato, and translates to "good, nice, and cheap"), BBB Foods remains in hypergrowth mode, so the market is willing to look past a slight earnings miss in favor of blistering sales growth.
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Altogether, it was a great quarter for the company as BBB Foods delivered:
- revenue growth of 39%
- a same-store sales increase of 20%
- adjusted EBITDA (non-including stock-based compensation) growth of 44%
- 155 new store openings to 3,624 total
- first-half of 2026 cash from operations growth of 119%
Image source: Getty Images.
Management believes Mexico can support "at least" 14,000 Tiendas 3B stores, so BBB could theoretically quadruple its store count over the long term. The company's Q2 results show that it is laser-focused on doing just that. Most importantly for investors, despite opening nearly 600 stores over the last year -- growing its share count by roughly 20% -- BBB is self-funding this incredible growth thanks to its booming cash from operations.
BBB Foods focuses on small-footprint locations, high-volume sales of a limited assortment, a private-label emphasis, and a low-cost model, and is often considered the "Aldi" of Mexico. With only 3% of grocery sales in Mexico coming from hard-discount grocers -- compared to 38% in Poland, 24% in Germany, and double digits in most developed countries -- the white space in front of BBB Foods is an incredible opportunity for the company and investors alike.
Currently, TBBB stock trades at somewhere around 30 times forward cash from operations, which isn't outrageous considering the company's incredible growth rates. I wouldn't go "all-in" on the stock after it has risen nearly 100% over the last year, but I'll be looking to add to my shares on any dip.
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Josh Kohn-Lindquist has positions in BBB Foods. The Motley Fool has positions in and recommends BBB Foods. The Motley Fool has a disclosure policy.
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