UBS Upgrades BBB Foods Inc (TBBB) to Buy

UBS analyst Vinicius Strano upgraded BBB Foods Inc (NYSE: TBBB) from Neutral to Buy with a price target of $51.00 (from $43.00).

The analyst comments: “We upgrade TBBB to Buy, with a new PT of US$51/share. 3B has consistently delivered SSS well ahead of inflation, and we believe its business benefits from consumers increasingly seeking value, amid mild macro conditions. While the broader retail space softens, we expect 3B top-line to accelerate in 2Q26, creating upside risk to guided 2026 top-line growth of 29-32% (UBSe: 33%). We forecast a 5 year revenue and EBITDA CAGR of 27% and 31%, respectively, reinforcing its outstanding growth profile. With the follow-on now behind (see Follow-On to Address Key Overhang),we believe key 12-month checkpoints will include: (i) 2Q top-line acceleration, underscoring trade-down lift; (ii) potential beat/raise to 2026 revenue guidance; and (iii) upside revisions to store expansion pace.

Hard discounting appears to be in early stages in Mexico, with about one hard discounter for each ~23k inhabitants, suggesting white space for growth and supporting 3B's estimate for at least 14,000 units (~4x the existing base). Plus, the gradual broadening of assortment (currently at 850-900 SKUs) into newer categories has enabled greater ticket and SSS growth. While momentum is likely benefited by trade-down and growing consumer share of wallet, we think 3B is likely to grow at ~30% annually. We also raise our revenue forecasts by ~2% across the board.”

For an analyst ratings summary and ratings history on BBB Foods Inc click here. For more ratings news on BBB Foods Inc click here.

Shares of BBB Foods Inc closed at $42.85 yesterday.

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