Bed Bath & Beyond (BBBY.US) shares managed to recoup all early losses caused by the weak quarterly results. The home goods retailer posted an unexpected loss caused by low inventories levels and warned about decreasing consumer demand.
- Company recorded a loss of $0.92 per share compared to profit of $0.40 per share, prior year. Meanwhile analysts projected profit of $0.03 per share. Revenue of $2.05 billion also came in below Wall Street estimates of $2.07 billion expected and reflects a 8% decline related to a planned reduction from non-core banner divestitures and a core sales decline of 14%.
- CEO Mark Tritton believes that macroeconomic factors including global supply chain disruptions, spread of the omicron variant and the "geopolitical turbulence weighing on consumer confidence," which altogether "uncovered more vulnerabilities than we could have foreseen."
- "The lack of available inventory to sell proved to be a continuing impediment to sales through the remainder of the fourth quarter and into the early part of fiscal 2022. Specifically, despite our overall inventory levels, products in transit, not available for sale or held at port remained abnormally high, particularly in key items," said Tritton.
- However, when it comes to the rest of the 2022 fiscal year, the company expects higher adjusted earnings for the second half, when compared to 2021 levels, but did not provide any specific guidelines regarding this matter.
- Recently Bank of America analyst Jason Haas downgraded BBBY.US stock to underperform with a price target of $9.50 warning "reality is about to hit hard for starry-eyed Bed Bath & Beyond shareholders."
Bed Bath & Beyond (BBBY.US) stock price launched today's session sharply lower, however buyers managed to regain control despite negative sentiment. Price bounced off the local support at $15.60 and is approaching major resistance at $19.50 which is marked with 23.6% Fibonacci retracement of the last correction. Source: xStation5
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