Bed bath and beyondGetty/Kevork Djansezian

  • Bed Bath & Beyond slightly missed on sales but beat on profits in the third quarter.
  • The retailer’s comparable sales decline was worse than expected.
  • The company maintained its earnings guidance that topped Wall Street estimates.
  • Watch Bed Bath & Beyond trade live.

Bed Bath & Beyond soared 9% to $13.36 a share early Thursday as investors brushed off soft sales and instead focused on its better-than-expected profit.

The home-goods seller announced late Wednesday that it earned $0.18 a share in the third quarter — $0.01 better than the Wall Street consensus, according to Bloomberg data. Its revenue totaled $3.03 billion, slightly missing the $3.04 billion that was expected. 

READ  Trump nominates new ICE director

But the results weren’t all good. The company’s same-store sales declined 1.8%, missing the 0.2% decrease that analysts estimated. 

Looking ahead, Bed Bath & Beyond maintained its earnings guidance of $2 per share, topping the $1.97 that analysts were expecting. 

The company’s guidance reflects many factors, including “the holiday selling season; the continuation of trends it has been experiencing; and actions being taken in support of the company’s stronger bias towards prioritizing long-term profitability over near-term sales growth,” said Bed Bath & Beyond in a press release. 

READ  Do This For the Finest Bloody Mary Ever - US

But at least one Wall Street analyst was skeptical of the plan. 

“Traction is taking hold with next-gen stores and assortment improvements, but these remain in their infancy, so near-term fundamentals should remain bleak,” said Jefferies analyst Jonathan Matuszewski in a note out on Thursday. 

READ  These 30 Baseball Quotes Clarify Easy methods to Be an All Star in Your Business

“We’d prefer stabilization in comps and margins until becoming more constructive. We appreciate BBBY’s initiatives, but need to see more progress off a larger base. Valuation reflects uncertainty with turnaround materializing, encroaching online competition, and too many stores,” Matuszewski added.

Matuszewski maintained his “hold” position and lowered his price target from $16 to $15 — 22% above where shares were trading on Wednesday.

Bed Bath & Beyond was down 34% in the past year.

Now read:

 

BBBYMarkets Insider

LEAVE A REPLY

Please enter your comment!
Please enter your name here