Why Bed Bath & Beyond Stock is Trading Lower in Pre Market Today
2022.04.14 15:11
Why Bed Bath & Beyond (BBBY) Stock is Trading Lower in Pre Market Today
Bed Bath & Beyond (NASDAQ:BBBY) stock price is down nearly 2% in pre-open Thursday after several Street analysts weighed in negatively on the company in the aftermath of the FQ4 earnings report released earlier this week.
BBBY reported 4Q EPS of -$0.92 on -12% comps, a big miss compared to the Street consensus of $0.13 on -8.3% comps.
Telsey Advisory Group analyst Cristina Fernández downgraded BBBY stock to Underperform from Market Perform with a $15.00 per share price target, down from $18.00. The analyst believes BBBY shares are overvalued by the market as they don’t reflect “weakening financial performance.”
Fernández adds that BBBY faces “a more challenging US consumer backdrop and ongoing supply chain challenges in 2022.”
“Both the 4Q21 result and 1Q22 quarter-to-date sales trend came in well below expectations, resulting in a significant downward revision to our 2022-2023 sales and earnings estimates and further eroding confidence in the turnaround. While the management team has made progress on rolling out private label brands and remodeling stores, there have been execution missteps around marketing and promotions. In addition, Bed Bath & Beyond’s legacy supply chain infrastructure limits the ability to move inventory around quickly and efficiently and offset the financial impact during a period of disruption. All in, the company’s performance gap vs. home furnishings peers continues to widen,” Fernández said in a client note.
BofA analyst Jason Haas cut the price target to $8.00 per share from $9.50 on the Sell-rated BBBY stock after “meaningfully cutting our estimates following BBBY’s disappointing 4Q results and outlook.”
“We’re increasingly concerned by BBBY’s leverage and cash burn,” the analyst added.
Similarly, Goldman Sachs) analyst Kate McShane reiterated a Sell rating and slashed the price target by 50% to $7.00 amid “the ongoing weakness in quarter-to-date comp trends that is expected to remain till at least 1H and continuously challenged store comps.”
By Senad Karaahmetovic
