Bed Bath & Beyond Q1 2018 earnings preview

Bed Bath & Beyond (BBBY), that was once America’s favorite home retailer is struggling to get its footing despite a favorable landscape. The comparable sales have been declining continuously for nine straight quarters as like other traditional retailers even Bed Bath & Beyond is being crushed by the intense competition from Amazon (AMZN) and Walmart (WMT). Things just got worse when the company issued full-year guidance that was way below the analysts’ expectation.

For the fiscal year 2018, the retailer expects earnings to be in the low-to-mid $2.00 range, much below Wall Street’s expectation of $2.76. The company will report the fiscal first-quarter earnings on June 27 after the bell. After the company reported lousy EPS guidance in April, the stock tanked to a 10-year low level. But since then there has been some improvement after the company came up with an aggressive plan to reinvent itself by 2020 and invest in technology.

For the fiscal year 2018, the retailer expects earnings to be in the low-to-mid $2.00 range, much below Wall Street’s expectation of $2.76.

Bed Bath & Beyond, who recently got its new CFO, aims to grow comp sales and EPS by 2020 for which the management is focusing on various strategies. Recently, the home goods chain rolled out a new membership program, Beyond +. As per this program, customers can get 20% discount on items purchased if they availed the $30 a year membership. Along with pricing and merchandising, the company is also working on its digital vision.

Related: Bed Bath & Beyond tanks on disappointing outlook

Since the start of the year, the company’s stock fell about 10%. For Q1 2018, analysts expect the company to post revenue of $2.75 billion, up 0.4% from the prior year period. EPS is estimated at $0.32, much lower than $0.58 earned during the previous year period.

In April, the company was hit by the downgraded credit rating of “BBB-“ by the S&P. Out of the 15 analysts who cover this stock, 7 advise to hold it, while the other 8 recommend to sell.

Related: Here is another blow for Bed, Bath & Beyond