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Bed Bath & Beyond Inc BBBY Stock Quote

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Morningstar‘s Stock Analysis BBBY

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Is it the right time to buy or sell?

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Progress in Inventory Clearance at Bed Bath, but Strategic Improvements Will Take Time

Jaime M. Katz, CFA Senior Equity Analyst

Analyst Note

| Jaime M. Katz, CFA |

No-moat Bed Bath & Beyond's second-quarter results were in line with the guidance offered Aug. 31. Sales of $1.4 billion fell 28% year over year on a 26% same-store sales decline, and an adjusted loss per share of $3.22 was significantly worse than the $0.04 per share profit last year. The only time Bed Bath has had a worse operating margin loss than in the first half (at 19%) was during the first quarter of 2020, when stores were temporarily shuttered in response to COVID-19. With an unchanged outlook for 2022 (same-store sales declining in a 20% range), we don’t plan to materially alter our $8 intrinsic value; we view the shares as fairly valued. In our opinion, the most important metrics ahead will pertain to profitability and liquidity as management attempts to stimulate demand.

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Key Statistics BBBY

Company Profile BBBY

Business Description

Bed Bath & Beyond is a home furnishings retailer, operating 955 stores in all 50 states, Puerto Rico, Canada, and Mexico (as of 2021), though it plans to close 150 underperforming stores in the near term. Stores carry an assortment of branded bed and bath accessories, kitchen textiles, and cooking supplies. In addition to 769 Bed Bath & Beyond stores, the company operates 135 Buybuy Baby stores and 51 Harmon Face Values stores (health/beauty care). In an effort to refocus on its core businesses, the firm has divested the online retailer, One Kings Lane, Christmas Tree Shops and That (gifts/housewares), Linen Holdings, and Cost Plus World Market in recent years.

650 Liberty Avenue
Union, NJ, 07083
T +1 908 688-0888
Industry Specialty Retail
Most Recent Earnings May 31, 2022
Fiscal Year End Feb 27, 2022
Employees 32,000

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