Investment Thesis
B&G Foods is a fundamentally distressed company with declining revenues (-5.4% YoY), persistent operating losses (-2.7% margin), and excessive leverage (4.97x debt-to-equity) that prevents debt service from operations. Negative interest coverage (-0.6x) combined with eroding profitability creates acute financial stress with limited margin for error.
Strengths
- Positive operating cash flow of $23.6M provides near-term liquidity buffer
- Free cash flow of $18.7M indicates ability to generate cash despite GAAP losses
- Gross margin of 19.5% demonstrates underlying product viability and pricing power
Risks
- Negative profitability across all metrics (net income -$32.5M, operating margin -2.7%, net margin -8.0%) with no path to profitability visible
- Excessive leverage with $2.0B long-term debt against $403.4M equity, creating severe solvency risk and refinancing vulnerability
- Negative interest coverage ratio (-0.6x) means operating income cannot cover interest expense, unsustainable without asset sales or equity raise
- Declining revenue trend (-5.4% YoY) reduces operational flexibility and leverage to spread fixed costs
Key Metrics to Watch
- Operating margin trajectory and path to positive operating income
- Revenue stabilization and return to growth
- Debt reduction or successful refinancing of $2.0B long-term debt obligation
- Operating cash flow sustainability and free cash flow adequacy for debt service
Financial Metrics
Revenue
408.9M
Net Income
-32.5M
EPS (Diluted)
$-0.41
Free Cash Flow
18.7M
Total Assets
2.8B
Cash
64.5M
Profitability Ratios
Gross Margin
19.5%
Operating Margin
-2.7%
Net Margin
-8.0%
ROE
-8.1%
ROA
-1.1%
FCF Margin
4.6%
Balance Sheet & Liquidity
Current Ratio
2.99x
Quick Ratio
1.42x
Debt/Equity
4.97x
Debt/Assets
85.8%
Interest Coverage
-0.56x
Long-term Debt
2.0B
Disclaimer: This analysis is generated by AI based on publicly available SEC EDGAR filings.
It does not include stock price data and should not be considered financial advice.
All fundamental data is sourced from SEC public domain filings.
Always conduct your own research before making investment decisions.
Data Source: SEC EDGAR |
Analysis Date: 2026-05-14T07:02:44.724922 |
Data as of: 2026-04-04 |
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