Categories Retail

Here is another blow for Bed, Bath & Beyond

Things are going from bad to worse for Bed, Bath & Beyond (BBBY). Last week, the home furnishing retailer reported its fourth quarter results. The company gave a bleak outlook for 2018 due to stiff competition and increasing expenses. The outlook provided by the retailer irked investors since it missed Street estimates. The stock soon took a severe beating post the results, trading at 10-year low levels.

On Tuesday, S&P downgraded the credit rating of the retailer to ‘BBB-‘ — the lowest provided by the agency. This is a deafening blow to the retailer, which might result in the loss of prospective lenders. It could also increase the interest payments on existing debt. After all, the company did report a $1.5-billion long-term debt at the end of fourth quarter.

Bed, Bath & Beyond Stock Price Trend

S&P also has added that it might push the bond rating to junk status, if the retailer cannot steady the ship amidst fierce competition from e-commerce and discount retailers. In January, rating agency Moody’s downgraded the rating to Baa2 (two levels above junk) for the company.

The retailer is struggling with declining same-store sales and rising expenses, resulting in lower margins. It also failed to tackle the onslaught of online retailers apart from its traditional peers. CEO Steven Temares and his team have a daunting task at hand.

It’s high time for the firm to look at closing down stores which aren’t making money, getting the right product mix in its stores, and improve the digital experience for users. Experts also have been pointing to the fact that it’s operating under too many different brand names with hardly any differentiation on the products or customers they are catering to. It’s a classic case of problem of plenty!

Most Popular

Earnings Preview: Home Depot’s Q3 report likely to reflect weak consumer demand

The US housing industry has been mostly resilient to headwinds like economic uncertainties so far this year. However, housing activity cooled in recent months as high mortgage rates and inflation

Take-Two Interactive (TTWO) will report Q2 2025 earnings this week, a few points to note

Shares of Take-Two Interactive Software, Inc. (NASDAQ: TTWO) stayed red on Monday. The stock has gained 16% over the past three months. The gaming company is set to report its second

Earnings Summary: Highlights of Loews Corporation’s (L) Q3 2024 report

Loews Corporation (NYSE: L), a diversified company with businesses in the insurance, energy, hospitality, and packaging industries, on Monday reported higher revenue and profit for the third quarter of 2024.

Tags

Add Comment
Loading...
Cancel
Viewing Highlight
Loading...
Highlight
Close
Top