Basic-Fit NV

Basic-Fit maintains a highly leveraged capital structure, with long-term debt of €3.16 billion against total equity of €398.8 million, resulting in a debt-to-equity ratio of 7.93. The company’s liquidity position is constrained, evidenced by a current ratio of 0.25, which indicates that current liabilities significantly exceed current assets. Despite this, the firm generates substantial operating cash flow of €647.4 million, which supports its ability to service debt and fund operations. Free cash flow stands at €222.5 million after capital expenditures of €278.0 million, suggesting that while the company is investing heavily in growth, it retains positive cash generation. The net cash position is negative after accounting for total debt, highlighting a reliance on external financing to sustain its balance sheet.

Profitability metrics reveal a company with high gross margins but low net returns. Gross profit is €1.37 billion on revenue of €1.42 billion, indicating a gross margin of approximately 96.4%, which is typical for a membership-based service model with low variable costs. However, operating income is €150.7 million, and net income is only €14.5 million, leading to a return on equity (ROE) of 3.64% and a return on assets (ROA) of 0.37%. These returns are modest relative to the high leverage employed, suggesting that the cost of debt and other operating expenses significantly compress net profitability. The price-to-earnings ratio of 139.36 reflects the low net income base, while the EV/EBITDA of 34.40 indicates a premium valuation relative to earnings before interest, taxes, depreciation, and amortization.

The company’s revenue is derived from its fitness center operations, with no specific segment or geographic breakdown provided in the available data. The absence of detailed segment information limits the ability to assess revenue concentration risks or regional performance variations. However, the high gross margin suggests a standardized, scalable business model across its locations. The company’s focus on leisure and fitness services positions it within a consumer discretionary context, where demand may be sensitive to economic cycles and consumer spending patterns.

Growth trajectory analysis is limited by the absence of historical period data in the input. Without multi-year revenue or net income trends, it is not possible to assess the company’s historical growth rate or consistency. The current revenue of €1.42 billion represents the latest normalized period, but without prior periods, year-over-year growth cannot be calculated. The company’s investment in capital expenditures of €278.0 million suggests an ongoing expansion strategy, which may drive future revenue growth if new centers achieve expected occupancy and membership levels.

Risk factors include medium liquidity risk and low dilution risk. The negative net cash position and high debt-to-equity ratio expose the company to refinancing risk and interest rate sensitivity. The current ratio of 0.25 indicates potential short-term liquidity pressures, although strong operating cash flow mitigates this to some extent. The key flag of negative net cash after debt subtraction underscores the importance of maintaining access to capital markets. Dilution risk is low, as indicated by the risk assessment, suggesting that the company is not currently issuing significant new equity.

Recent events include analyst estimates with a mean price target of €40.80 and a median of €42.00, reflecting a positive outlook from the investment community. The mean recommendation of 1.83, with six strong buys and three buys, indicates strong analyst confidence in the company’s prospects. The high price target of €49.00 and low of €29.50 show a range of expectations, but the consensus leans towards upside potential. These estimates suggest that analysts view the company’s growth strategy and cash flow generation as outweighing the risks associated with its leverage.

Revenue grew at a 42.9% CAGR from 2022 to 2026, demonstrating strong top-line expansion momentum.

Free cash flow surged 96.0% year-over-year to EUR 222.5 million in fiscal 2026.

Cash conversion of 44.65% is the best in class among the ten comparable cohort peers.

Net income improved significantly, rising 81.2% year-over-year to EUR 14.5 million in fiscal 2026.

The company carries a high credit risk flag, indicating significant potential for debt-related financial distress.

Debt-to-equity ratio of 7.93 is substantially higher than the cohort median of 1.22.

Return on assets of 0.37% suggests inefficient utilization of the company's total asset base.

Long-term debt increased to EUR 3.16 billion in fiscal 2026, reflecting rising leverage obligations.

The firm faces a medium liquidity risk flag, highlighting potential short-term solvency concerns.

Revenue €396.0M, +19,3% YoY.

• ▍Revenue €396.0M, +19,3% YoY

Revenue €356.7M, +16,1% YoY.

• ▍Revenue €356.7M, +16,1% YoY

Revenue €332.0M.

• ▍Revenue €332.0M

Revenue €307.2M.

• ▍Revenue €307.2M

Revenue €1.42B, +16,9% YoY; Operating income +21,9% YoY.

• ▍Revenue €1.42B, +16,9% YoY
• ▍Operating income +21,9% YoY
• ▍Net income +81,2% YoY
• ▍Free cash flow +96,0% YoY
• ▍Net margin 1.0%

Revenue €1.22B, +16,0% YoY; Operating income +36,3% YoY.

• ▍Revenue €1.22B, +16,0% YoY
• ▍Operating income +36,3% YoY
• ▍Net income +398,6% YoY
• ▍Free cash flow +108,8% YoY
• ▍Net margin 0.7%

Revenue €1.05B, +31,8% YoY; Operating income +63,5% YoY.

• ▍Revenue €1.05B, +31,8% YoY
• ▍Operating income +63,5% YoY
• ▍Net income +27,3% YoY
• ▍Free cash flow +12,0% YoY
• ▍Net margin -0.3%

Revenue €794.6M, +133,2% YoY; Operating income +138,4% YoY.

• ▍Revenue €794.6M, +133,2% YoY
• ▍Operating income +138,4% YoY
• ▍Net income +97,5% YoY
• ▍Free cash flow +209,7% YoY
• ▍Net margin -0.5%

Revenue €340.7M; Operating income -€144.6M.

• ▍Revenue €340.7M
• ▍Operating income -€144.6M
• ▍Net margin -44.0%