BNEDBarnes & Noble Education, Inc.
Is the business good?
A genuinely good business: earnings fully cash-backed (1.9×) and margins widening.
Operating profit is fully backed by cash. Conversion is improving vs a year ago.
Operating margin has widened over the past few years, the business is getting more profitable per dollar of sales.
Efficiency-driven, thin margins turned over fast (the retail model). ROE 3% = margin × turnover × leverage.
Unless marked, from derived.
Where this answer is blind. The F-score rewards improvement, so an already-elite company can score mid-pack.
How good a business is BNED?
Barnes & Noble Education, Inc. earns 8.5% on the capital it employs against a 9.0% cost of capital, so growth costs more than it returns.
Return on invested capital · cost of capital 9.0% · 0.49 points below what the capital costs: growth destroys value
- Operating margin
- 2.5%
Operating margin · Specialty Retail median 8.1% · 12 months to Q1 2027
- Cash conversion
- 1.90×
Cash conversion · −0.38× a year ago · operating cash flow covers the operating profit after tax
- Share count, year on year
- +1.4%
Share count, year on year · shareholders own a smaller slice than a year ago
| Year | Operating margin |
|---|---|
| FY2021 | −12% |
| FY2022 | −4.0% |
| FY2023 | −4.3% |
| FY2024 | −2.2% |
| FY2025 | 0.99% |
| FY2026 | 2.1% |
Details›
- Gross margin12 months to Q1 2027
- 21%
- Operating margin12 months to Q1 2027
- 2.5%
- Net margin12 months to Q1 2027
- 1.3%
- Free cash flow margin
- 2.8%
- Revenue, trailing twelve months
- $1.72B
- Free cash flow, trailing twelve months
- $49M
- Net income, trailing twelve months
- $22M
- Return on invested capitaloperating profit after tax ÷ debt + equity − cash
- 8.5%
Margins, capital and share counts from the statements as filed with the SEC; cash conversion is operating cash flow over operating profit after tax.