Betterware de México, S.A.P.I. de C.V. (BWMX) | Investment Case

1. Company Snapshot

1.a. Company Description

Betterware de México, S.A.P.I. de C.V. operates as a direct-to-consumer company in Mexico.It focuses on the home organization segment with a product portfolio, including home solutions, kitchen and food preservation, technology and mobility, bedroom, bathroom, laundry and cleaning, and other categories.The company sells its products through twelve catalogues.

Betterware de México, S.A.P.I. de C.V. was incorporated in 1995 and is based in Zapopan, Mexico.Betterware de México, S.A.P.I. de C.V. is a subsidiary of Campalier, S.A. de C.V.

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1.b. Last Insights on BWMX

Here is a 90-word analysis of the negative drivers behind Betterware de México's recent stock performance: The company's Q4 2024 earnings release revealed weaknesses in its financial performance, weighing on investor sentiment. The figures presented in the report showed nominal Mexican Pesos, which may have obscured the true extent of the company's struggles. Additionally, the lack of a share buyback program or other value-enhancing initiatives may have contributed to the negative outlook. The company's high medical care ratios and escalating costs, as mentioned in the earnings call, are also likely to have hurt investor confidence.

1.c. Company Highlights

Last Price	14.22
Change Percentage	-0.84%
Open	14.28
Previous Close	14.34
Market Cap ( Millions)	531
Volume	20213
Year High	15
Year Low	7
M A 50	13.64
M A 200	11.56

FCF Yield	15.76%
Dividend Yield	8.24%
ROE	87.45%
Debt / Equity	402.65%
Net Debt / EBIDTA	188.49%
Price To Book	7.44
Price Earnings Ratio	9.4
Price To FCF	6.34
Price To sales	0.68
EV / EBITDA	5.61

2. Betterware de México Posts Mixed Q1 Results Amid Macro Challenges

Betterware de México reported a challenging first quarter, with net revenues declining 2.9% year-over-year, reflecting macroeconomic headwinds in its key markets. The company cited softening consumer trends in Mexico, U.S. disruptions, and rising tariffs in China as primary factors impacting performance. Gross margin fell 303 basis points, driven by higher import costs and promotional investments, while EBITDA dropped 29.1%, with both Betterware Mexico and Jafra Mexico contributing to the decline. EPS came in at $0.2, well below the consensus estimate of $0.41, highlighting the severity of the profitability squeeze. Despite these short-term challenges, management reaffirmed its 2025 guidance, anticipating 6-9% revenue and EBITDA growth, underscoring confidence in its long-term fundamentals.

Publication Date: Apr -25

                                    📋 Highlights
                                    Revenue Decline:
                                                Consolidated net revenues decreased 2.9% year-over-year, impacted by macroeconomic challenges and 20% peso depreciation.
Gross Margin Compression:
                                                Gross margin fell 303 basis points due to higher import costs and promotional investments.
EBITDA Drop:
                                                EBITDA decreased 29.1%, with Betterware Mexico down 31.6% and Jafra Mexico down 25.2%.
Dividend Announcement:
                                                The board proposed a 200 million peso dividend despite negative free cash flow and rising net debt to EBITDA of 2.08.
Guidance Maintenance:
                                                The company maintained its 2025 guidance, expecting 6-9% revenue and EBITDA growth despite current macroeconomic challenges.

                                

Operational Highlights and Strategic Initiatives

The company is taking proactive steps to navigate the current environment, focusing on pricing strategies, promotional activity, and operational efficiency. At Jafra, efforts are underway to rebalance the product mix and drive innovation, while Betterware Mexico is leveraging its agile commercial structure to maintain market share. Management also emphasized the importance of sourcing diversification to mitigate supply chain risks. However, the near-term outlook remains uncertain, with inventory levels elevated due to Jafra's brand renewal initiatives, though management expects a return to normal levels in the coming quarters. The board's proposal of a 200 million peso dividend underscores its commitment to shareholder returns, even as free cash flow turned negative in the quarter.

Valuation and Investor Outlook

With a forward P/E ratio of 8.32 and a dividend yield of 13.7%, the stock appears attractively valued for income-oriented investors. The P/S ratio of 0.54 further highlights its relatively low valuation multiples, suggesting that much of the macroeconomic uncertainty may already be priced in. The company's high ROE of 61.84% and robust ROIC of 18.05% indicate strong underlying profitability, despite the short-term margin pressures. While the net debt-to-EBITDA ratio of 1.96 is modest, the free cash flow yield of 23.9% stands out as a key metric, reflecting the company's ability to generate cash even in challenging conditions. Investors will likely focus on the company's ability to stabilize margins and deliver on its growth targets as macroeconomic conditions evolve.

3. NewsRoom

Betterware de Mexico SAPI de C (NYSE:BWMX) vs. Pattern Group (NASDAQ:PTRN) Head to Head Review

Nov -06

Source: defenseworld.net

New Strong Sell Stocks for Oct. 28th

Oct -28

Source: zacks.com

Betterware: From Jalisco To The Andes

Oct -28

Source: seekingalpha.com

BeFra Announces US$0.29 Per Share Quarterly Dividend Payable on November 20, 2025

Oct -24

Source: businesswire.com

Betterware de México, S.A.P.I. de C.V. (BWMX) Q3 2025 Earnings Call Transcript

Oct -23

Source: seekingalpha.com

Betterware de Mexico SAPI de C (BWMX) Surpasses Q3 Earnings Estimates

Oct -23

Source: zacks.com

BeFra Reports Third Quarter 2025 Results

Oct -23

Source: businesswire.com

Reviewing Pattern Group (NASDAQ:PTRN) & Betterware de Mexico SAPI de C (NYSE:BWMX)

Oct -22

Source: defenseworld.net

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (5.51%)

6. Segments

Fragrance

Expected Growth: 5.5%

Betterware de México's 5.5% growth in fragrance sales is driven by increasing demand for premium and niche fragrances, particularly among Mexico's growing middle class. Additionally, the company's strong distribution network and strategic partnerships with international brands have enabled it to capitalize on trends such as sustainability and e-commerce.

Kitchen and Food Preservation

Expected Growth: 5.2%

Betterware de México's 5.2% growth in Kitchen and Food Preservation is driven by increasing demand for convenient meal prep, health-conscious consumers seeking fresh food storage solutions, and a growing middle class in Mexico seeking premium kitchenware. Additionally, the company's strong brand recognition, wide distribution network, and innovative product offerings contribute to its growth momentum.

Home Solutions

Expected Growth: 5.8%

Betterware de México's 5.8% growth in Home Solutions is driven by increasing demand for home organization and decoration products, a growing middle class in Mexico, and the company's successful direct sales model. Additionally, the company's focus on innovation, quality, and customer service has led to strong brand loyalty and repeat business.

Color

Expected Growth: 5.6%

Color from Betterware de México, S.A.P.I. de C.V. achieved 5.6% growth driven by increasing demand for home organization and decoration products, expansion into new markets, and successful marketing strategies. Additionally, the company's focus on e-commerce and digital platforms contributed to its growth, as well as its ability to adapt to changing consumer preferences.

Skin Care

Expected Growth: 5.4%

Betterware de México's 5.4% growth in Skin Care is driven by increasing demand for natural and organic products, a growing middle class with rising disposable income, and a strong online presence. Additionally, the company's focus on product innovation, expansion into new distribution channels, and effective marketing strategies have contributed to its growth.

Laundry & Cleaning

Expected Growth: 5.1%

Betterware de México's 5.1% growth in Laundry & Cleaning is driven by increasing demand for eco-friendly and sustainable products, rising disposable income, and a growing middle class in Mexico. Additionally, the company's strong distribution network and effective marketing strategies have contributed to its growth.

Bedroom

Expected Growth: 5.3%

The 5.3% growth in Bedroom segment of Betterware de México, S.A.P.I. de C.V. is driven by increasing demand for home organization and storage solutions, rising disposable income, and growing popularity of online shopping. Additionally, the company's focus on product innovation, marketing strategies, and expanding distribution channels also contribute to the growth.

Tech & Mobility

Expected Growth: 6.2%

Betterware de México's Tech & Mobility segment growth of 6.2% is driven by increasing adoption of digital platforms, rising demand for e-commerce and online services, and strategic investments in digital transformation. Additionally, the company's focus on innovation, customer experience, and operational efficiency has contributed to the segment's growth.

Toiletries

Expected Growth: 5.7%

Betterware de México's 5.7% growth in Toiletries is driven by increasing demand for personal care products, particularly among Mexico's growing middle class. Expanding distribution channels, innovative product offerings, and effective marketing strategies also contribute to the segment's growth.

Bathroom

Expected Growth: 5.9%

Betterware de México's 5.9% growth in the Bathroom segment is driven by increasing demand for home improvement, rising middle-class disposable income, and a growing preference for modern and hygienic bathroom solutions. Additionally, the company's strong brand recognition, wide distribution network, and innovative product offerings contribute to its market share expansion.

Wellness

Expected Growth: 6.1%

Betterware de México's 6.1% growth in Wellness segment is driven by increasing demand for healthy living, rising middle-class population, and growing awareness of preventive healthcare. Additionally, the company's strong distribution network, innovative product offerings, and effective marketing strategies have contributed to its growth.

Home Organization - Others

Expected Growth: 5.0%

Betterware de México's 5.0% growth in Home Organization - Others is driven by increasing demand for organized living spaces, rising middle-class income, and a growing preference for DIY home improvement projects. Additionally, the company's strong brand recognition, wide product offerings, and effective distribution channels contribute to its market share expansion.

7. Detailed Products

Kitchenware

Betterware de México offers a wide range of kitchenware products, including cookware, cutlery, and kitchen utensils, designed to make cooking and food preparation easier and more efficient.

Home Organization

Betterware de México's home organization products include storage solutions, shelving, and decorative items, designed to help customers organize and declutter their living spaces.

Cleaning and Laundry

Betterware de México offers a variety of cleaning and laundry products, including cleaning supplies, laundry detergent, and fabric softener, designed to make cleaning and laundry tasks easier and more efficient.

Personal Care

Betterware de México's personal care products include skincare, haircare, and fragrances, designed to help customers take care of their personal hygiene and beauty needs.

Wellness and Health

Betterware de México offers a range of wellness and health products, including nutritional supplements, fitness equipment, and wellness accessories, designed to support customers' overall health and wellness.

8. Betterware de México, S.A.P.I. de C.V.'s Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for Betterware de México, S.A.P.I. de C.V. is medium due to the presence of alternative products in the market, but the company's strong brand recognition and customer loyalty mitigate this threat.

Bargaining Power Of Customers

The bargaining power of customers is low for Betterware de México, S.A.P.I. de C.V. due to the company's strong distribution network and wide range of products, making it difficult for customers to negotiate prices.

Bargaining Power Of Suppliers

The bargaining power of suppliers is medium for Betterware de México, S.A.P.I. de C.V. due to the company's dependence on a few large suppliers, but the company's strong relationships with suppliers mitigate this threat.

Threat Of New Entrants

The threat of new entrants is high for Betterware de México, S.A.P.I. de C.V. due to the low barriers to entry in the market, but the company's strong brand recognition and established distribution network make it difficult for new entrants to compete.

Intensity Of Rivalry

The intensity of rivalry is high for Betterware de México, S.A.P.I. de C.V. due to the presence of several competitors in the market, but the company's strong brand recognition and wide range of products help it to maintain its market share.

9. SWOT Analysis

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

	Value
Debt Weight	78.87%
Debt Cost	9.00%
Equity Weight	21.13%
Equity Cost	9.00%
WACC	9.00%
Leverage	373.27%

11. Quality Control: Betterware de México, S.A.P.I. de C.V. passed 5 out of 9 key points

Strong Liquidity

Low Deb

Strong Interest Coverage

Healthy Cash Flow

Operating Efficiency

Strong Return On Equity

Consistent Revenue Growth

Consistent Operating Cash Flow Growth

Margin Improvement

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Clas Ohlson

A-Score: 5.7/10

Value: 3.2

Growth: 6.2

Quality: 7.1

Yield: 5.0

Momentum: 10.0

Volatility: 2.7

1-Year Total Return ->

New Wave Group

A-Score: 5.7/10

Value: 4.2

Growth: 7.1

Quality: 6.2

Yield: 6.9

Momentum: 5.5

Volatility: 4.0

1-Year Total Return ->

Betterware de México

A-Score: 5.5/10

Value: 5.4

Growth: 5.6

Quality: 5.5

Yield: 10.0

Momentum: 5.0

Volatility: 1.3

1-Year Total Return ->

Card Factory

A-Score: 5.4/10

Value: 8.5

Growth: 4.2

Quality: 6.5

Yield: 3.8

Momentum: 6.0

Volatility: 3.3

1-Year Total Return ->

Matas

A-Score: 5.0/10

Value: 6.4

Growth: 6.2

Quality: 3.5

Yield: 2.5

Momentum: 5.0

Volatility: 6.7

1-Year Total Return ->

Mobilezone

A-Score: 4.8/10

Value: 6.0

Growth: 2.9

Quality: 4.2

Yield: 9.4

Momentum: 1.5

Volatility: 5.0

1-Year Total Return ->

Peers Metrics

12.e Scoring ^Insights

12.f DCF ^BETA

Parameters

Short Term Growth

-11.82%

Short term Time

10.0

Long-Term Growth

2.00%

WACC

9.00%

Betterware de México, S.A.P.I. de C.V. - MX00BW020002

1. Company Snapshot

1.a. Company Description

1.b. Last Insights on BWMX

1.c. Company Highlights

Higher Growth

More Volatile

Strong Momentum

Earnings Miss

Revenues Beats

Average Quality

Earnings Beats

Higher Yield

Revenues Miss

Weak Momentum

Stable Momentum

Average Yield

2. Betterware de México Posts Mixed Q1 Results Amid Macro Challenges

Operational Highlights and Strategic Initiatives

Valuation and Investor Outlook

3. NewsRoom

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (5.51%)

6. Segments

Fragrance

Expected Growth: 5.5%

Kitchen and Food Preservation

Expected Growth: 5.2%

Home Solutions

Expected Growth: 5.8%

Color

Expected Growth: 5.6%

Skin Care

Expected Growth: 5.4%

Laundry & Cleaning

Expected Growth: 5.1%

Bedroom

Expected Growth: 5.3%

Tech & Mobility

Expected Growth: 6.2%

Toiletries

Expected Growth: 5.7%

Bathroom

Expected Growth: 5.9%

Wellness

Expected Growth: 6.1%

Home Organization - Others

Expected Growth: 5.0%

7. Detailed Products

Kitchenware

Home Organization

Cleaning and Laundry

Personal Care

Wellness and Health

8. Betterware de México, S.A.P.I. de C.V.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Bargaining Power Of Customers

Bargaining Power Of Suppliers

Threat Of New Entrants

Intensity Of Rivalry

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

11. Quality Control: Betterware de México, S.A.P.I. de C.V. passed 5 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

12.e Scoring ^Insights

12.f DCF ^BETA