Bed Bath & Beyond Shares Slide as In-Store Sales Still Lag
(Bloomberg) -- Bed Bath & Beyond Inc. shares dropped as sales in physical locations proved to be a drag on the retailer’s turnaround efforts, overshadowing progress online. Still, the outlook for the year was better than expected.
- The retailer sees its earnings per diluted share this fiscal year growing slightly to between $2.06 and $2.15 a share, beating the $1.85 a share that analysts had been expecting.
- A trio of activist investors -- Legion Partners Asset Management LLC, Macellum Advisors and Ancora Advisors LLC -- launched a campaign in March to remove Chief Executive Officer Steven Temares and replace the entire 12-person board. The company said its turnaround plan “accelerated” in the past year, which may strengthen its case to stay the course.
- The company said there are more shifts ahead. It plans to announce additional changes to the board, governance structure and compensation practices in the near future, it said -- though that may not be enough to satisfy the activists.
- There are also some signs of lingering challenges. Comparable sales, a closely watched measure in retail, fell 1.4 percent. Analysts had forecast a decline of 1.3 percent, according to Consensus Metrix. The retailer cited a stronger e-commerce business but a mid-single-digit percentage drop in in-store sales.
- Bed Bath & Beyond shares initially rose in late trading in New York before reversing course. Shares were down 5.2 percent as of 5:03 p.m. in New York. The stock, which jumped 22 percent in March after activists disclosed their challenge, was the most shorted stock in the Russell 3000 on Tuesday afternoon ahead of the earnings release.
- Get more on the numbers here.
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