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Bed Bath & Beyond Likely To Face Heat Due To Changing Consumer Spending, Says Analyst

  • Raymond James analyst Bobby Griffin has reiterated an Underperform rating on the shares of Bed Bath & Beyond Inc (NASDAQ: BBBY).

  • The analyst said the company’s Q2 sales were relatively in-line with its August 31 business update, while adjusted EBIT came in below his and consensus expectations, primarily driven by higher-than-anticipated SG&A.

  • He added that the management reaffirmed its FY22 guidance elements given during its business update as its recent initiatives (national brand inventory build, SG&A cuts, etc.) have not yet materially impacted results.

  • Griffin specified while Bed Bath & Beyond’s improved liquidity position gives new management some additional time, it likely only ‘kicks the can down the road’ as underlying business trends remain very challenging.

  • Also ReadWinning Consumers Back Will Be Challenging For Bed Bath & Beyond, Says This Analyst

  • Even with a move back towards more branded products, Griffin struggles to see a pathway for improved performance, especially with discretionary consumer spending and housing slowing further in the second half of 2023.

  • The ongoing cash burn and need to preserve cash/liquidity, the analyst says, will limit in-store investments, likely only further hindering customer traffic and the brand perception with younger consumers.

  • Price Action: BBBY shares are trading higher by 0.89% at $6.24 on the last check Friday.

  • Photo Via Company

Latest Ratings for BBBY

Date

Firm

Action

From

To

Mar 2022

Telsey Advisory Group

Maintains

Market Perform

Jan 2022

Goldman Sachs

Maintains

Sell

Jan 2022

Telsey Advisory Group

Maintains

Market Perform

View More Analyst Ratings for BBBY

View the Latest Analyst Ratings

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