Is BBWI a high-quality business?

AlphaMadera's AlphaQuality grade scores Bath & Body Works, Inc. on six pillars — profitability, capital efficiency, balance-sheet strength, growth durability, cash generation, and shareholder yield. The composite letter grade reflects how BBWI compares to a Buffett-style quality bar.

What is Bath & Body Works, Inc.'s AlphaQuality grade?

AlphaQuality assigns a letter grade (A through F) to BBWI based on a six-pillar quantitative model. The live page shows the composite grade plus each pillar's individual score with the underlying metrics.

What makes BBWI a quality stock?

AlphaQuality looks at return on capital, free-cash-flow margins, debt-to-equity, revenue stability, dividend and buyback policy, and operating-margin trend. Stocks scoring well across all six pillars earn higher grades — the methodology favors compounders over cyclicals.

BBWI - Bath & Body Works, Inc.

Price: -- -- | CONSENSUS: Hold DETAILS | PRICE TARGET: $22.25 DETAILS

AlphaQuality

Quantitative six-pillar business-quality grade

Stable Earnings Power

AlphaQuality — archetype-weighted quantitative grade

C 54.0 / 100 composite

Composite Grade

Composite of six pillars weighted for stable earnings power businesses. Purely quantitative — no stock price or analyst input.

Profitability

Weight: 20%

B 70.0

5yr Avg ROIC 28.3% 100/100
Operating Margin Trend -2.10 pp/yr 0/100

Capital Efficiency

Weight: 15%

D+ 41.5

5yr Avg ROE 0.0% 10/100
5yr Share-Count CAGR -6.2% 100/100

Growth Quality

Weight: 15%

F 11.3

5yr Revenue CAGR -1.9% 16/100
5yr EPS CAGR -10.9% 0/100
Revenue-Growth Years (5) 1/5 20/100

Cash Generation

Weight: 15%

A- 83.7

5yr FCF Margin 11.2% 73/100
5yr FCF/NI Conversion 0.97x 97/100

Balance Sheet

Weight: 20%

C 54.8

Net Debt / EBITDA 2.83x 53/100
Interest Coverage (EBIT/Int) 4.20x 57/100
Altman Z-Score 2.44 55/100

Stability

Weight: 15%

C 56.5

EPS Volatility (σ/μ) 0.20 70/100
Piotroski F-Score 6 67/100
Negative-Revenue Years (5) 4/5 20/100

3 of 4 gurus held; 1 added; 2 trimmed; 1 full exit.

Holders: 3 -1
Avg Δ position: -1.7%
New buys: 0
Full exits: 1

Dalio sold -100%
Wood decreased -16%
Greenblatt increased +14%

How this is calculated

AlphaQuality grades six pillars from 0-100 and weights each by archetype:

Profitability (20%) — 5yr Avg ROIC, Operating Margin Trend
Capital Efficiency (15%) — 5yr Avg ROE, 5yr Share-Count CAGR
Growth Quality (15%) — 5yr Revenue CAGR, 5yr EPS CAGR, Revenue-Growth Years (5)
Cash Generation (15%) — 5yr FCF Margin, 5yr FCF/NI Conversion
Balance Sheet (20%) — Net Debt / EBITDA, Interest Coverage (EBIT/Int), Altman Z-Score
Stability (15%) — EPS Volatility (σ/μ), Piotroski F-Score, Negative-Revenue Years (5)

We deliberately ignore stock price, analyst targets, and consensus ratings so the grade is suitable for backtesting forward returns. A minimum of 5 fiscal years of audited statements is required; distressed and highly leveraged infrastructure businesses are declared ungradable rather than forced into a numeric score.