Bed Bath & Beyond tanks on gloomy outlook

I guess Frank the Tank from "Old School" didn't have enough time to go to Bed Bath & Beyond for a pretty nice little ...

Posted: Apr 12, 2018 6:53 PM
Updated: Apr 12, 2018 6:53 PM

I guess Frank the Tank from "Old School" didn't have enough time to go to Bed Bath & Beyond for a pretty nice little Saturday last quarter -- and neither did a lot of Americans apparently.

Shares of Bed Bath & Beyond plunged 20% Thursday to a near-10-year low. The home furnishings retailer posted a drop in same-store sales and warned that earnings for the full year would miss Wall Street's forecasts. By a lot.

The company said it now expected to earn around $2 to $2.50 per share for this year. Analysts were expecting a profit of $2.77 a share.

Competition is fierce in retail. Stop me if you've heard this before, but Walmart and Amazon have both been stepping up their efforts in the home furnishings category lately.

Bed Bath & Beyond also faces tough competition from Crate & Barrel (owned by privately held German retailer Otto) as well as Home Depot. This has all put pressure on Bed Bath & Beyond.

And one analyst said that Bed Bath & Beyond's aggressive discounting (admit it, you have tons of those 20% off vouchers in your physical and digital mailboxes) is hurting its earnings as well. Too many promotions can be a bad thing.

"Profit is also affected by Bed Bath & Beyond's discounting and its rather slapdash approach to coupons and vouchers," wrote Neil Saunders, managing director of research firm GlobalData Retail in a report.

"As much as we recognize this has played an important historical role in the company's success, we also believe that its dependence upon it is now a symptom of a rather poor retail strategy and questionable execution," Saunders added.

Related: Retail defaults soar to record high in 2018

It all comes back to competition. Bed Bath & Beyond is part of an increasingly crowded field. And during a conference call with analysts, executives conceded the company needs to do more to compete online with Amazon, Walmart and other retailers.

The problem though is that it is costing Bed Bath & Beyond money -- both in terms of increased marketing expenses and lower prices to stay competitive with rivals -- to build out its e-commerce operation.

"We have spent the last few years driving the digital experience in terms of getting customers to understand us as a digital choice for them, and in the world we compete, that's necessary to introduce customers to us as a digital choice. We've been doing that to some degree at the expense of profitability," Bed Bath & Beyond CEO Steven Temares told analysts.

So it should come as no surprise that nine Wall Street analysts cut their ratings on Bed Bath & Beyond's stock after the earnings report, according to FactSet.

In other words, Wall Street is really nervous about how much money Bed Bath & Beyond will need to spend to convince Frank the Tank to find the time to shop at Bed Bath & Beyond's web site or on its mobile app.

Huntsville
Scattered Clouds
60° wxIcon
Hi: 76° Lo: 52°
Feels Like: 60°
Florence
Clear
61° wxIcon
Hi: 65° Lo: 53°
Feels Like: 61°
Fayetteville
Broken Clouds
60° wxIcon
Hi: 74° Lo: 50°
Feels Like: 60°
Decatur
Clear
58° wxIcon
Hi: 74° Lo: 51°
Feels Like: 58°
Scottsboro
Overcast
61° wxIcon
Hi: 79° Lo: 54°
Feels Like: 61°
WAAY Radar
WAAY WAAY-TV Cam
WAAY Temperatures

Alabama Coronavirus Cases

Confirmed Cases: 136055

Reported Deaths: 2364
CountyConfirmedDeaths
Jefferson19752350
Mobile13449292
Montgomery8852184
Tuscaloosa8654118
Madison792778
Shelby601349
Lee592760
Baldwin552650
Marshall396143
Calhoun353444
Etowah352145
Morgan331428
Houston292021
Elmore267348
DeKalb243221
St. Clair233036
Walker231984
Talladega217129
Limestone211920
Cullman190720
Dallas179126
Franklin178129
Autauga177325
Russell17633
Lauderdale172333
Colbert166626
Blount161715
Escambia161124
Chilton158830
Jackson158111
Covington140327
Dale139244
Coffee13596
Pike120510
Chambers116842
Tallapoosa116485
Clarke110016
Marion96829
Butler91339
Barbour8857
Winston74512
Marengo72420
Pickens66614
Bibb65610
Lowndes65427
Randolph65413
Hale64428
Geneva6344
Lawrence62123
Cherokee61213
Bullock60614
Monroe5908
Clay5878
Washington55913
Perry5416
Crenshaw54032
Conecuh53611
Wilcox53211
Henry5075
Macon48318
Fayette4628
Sumter43819
Cleburne3825
Lamar3702
Choctaw35112
Greene30315
Coosa1723
Out of AL00
Unassigned00

Tennessee Coronavirus Cases

Confirmed Cases: 192995

Reported Deaths: 2377
CountyConfirmedDeaths
Shelby30953459
Davidson26630306
Hamilton951995
Knox949779
Rutherford936189
Williamson531036
Sumner486598
Wilson351945
Putnam334940
Montgomery311144
Unassigned30425
Out of TN298627
Bradley296217
Madison292164
Sevier263815
Blount253524
Maury240924
Washington232836
Robertson222535
Sullivan219733
Hamblen193926
Tipton183219
Gibson170423
Trousdale16667
Hardeman158226
Wayne14995
Dyer138714
Bedford136417
Dickson127415
Coffee125413
Cumberland121718
Weakley120519
Fayette120419
Anderson120013
Obion119110
Henderson118924
Loudon11846
Carter117728
Greene116144
McMinn114625
Jefferson113014
Warren10757
Lawrence106713
Macon106721
Monroe105218
Hardin104716
Lauderdale99416
Haywood99221
Franklin9899
Lake9252
Roane9055
Carroll89920
McNairy89618
Bledsoe8624
White8479
Rhea84412
Hawkins82218
Cheatham81510
Marshall7785
Overton7586
Cocke7549
Smith73111
Johnson7262
Chester64310
Giles63117
Henry6289
Lincoln6241
Hickman5938
DeKalb57014
Crockett54219
Marion5338
Decatur5307
Fentress5263
Campbell4544
Claiborne4425
Polk39910
Grainger3863
Union3642
Benton3379
Jackson3315
Morgan3203
Grundy3095
Cannon2920
Unicoi2891
Humphreys2583
Sequatchie2381
Clay2335
Meigs2283
Houston2243
Scott2172
Stewart2142
Lewis2041
Moore1791
Van Buren1660
Perry1530
Pickett1232
Hancock1083

Community Events