Market Overview

Baird On Bed Bath & Beyond's Stock: 'Worth A Shot'

Share:
Baird On Bed Bath & Beyond's Stock: 'Worth A Shot'

Retail executives face an uphill battle in succeeding in a turnaround plan but a bullish stance on Bed Bath & Beyond Inc. (NASDAQ: BBBY) is "worth a shot," according to Baird.

The Analyst: Peter Benedict upgraded Bed Bath & Beyond's stock from Neutral to Outperform with a price target lifted from $13 to $20.

The Thesis: Bed Bath & Beyond CEO Mark Tritton deserves credit for overhauling the C-suite by bringing in omni-channel and business transformation experts, Benedict wrote in the note. Tritton is expected to explain his full turnaround around at an October investor meeting, but early indications favor a chance at overseeing a successful turnaround.

Related Link: Bed Bath & Beyond Reports Q1 Earnings Miss After Pandemic Store Closures

Meanwhile, early signs of "real change" are evident, including improvements over its private/owned brands, vendor renegotiation and data-driven assortment optimization. Consumers are also reacting well to a refreshed website experience, buy-online-pickup-in-store and curbside options. Renewed traction with customers could improve in 2021 and beyond from "meaningful" catalysts like store remodels.

Benedict said the company also proceeding with a cost savings program and potential asset sales that will help drive $335 million or more of profit improvement over the next two to three years.

Finally, more than 80% of analysts hold a neutral or bearish stance on Bed Bath & Beyond's stock while the market is assigning a minimal probability of success. This creates an "intriguing setup" and even if the company falls 50% short of its $800 million EBITDA target, the stock still has an upside potential of 50%

BBBY Price Action: Shares of Bed Bath & Beyond were trading higher by 5.7% at $14.12.

Latest Ratings for BBBY

DateFirmActionFromTo
Oct 2020Raymond JamesMaintainsStrong Buy
Oct 2020Raymond JamesMaintainsStrong Buy
Sep 2020B of A SecuritiesMaintainsBuy

View More Analyst Ratings for BBBY
View the Latest Analyst Ratings

 

Related Articles (BBBY)

View Comments and Join the Discussion!

Posted-In: Baird Peter Benedict retail retailersAnalyst Color Upgrades Price Target Analyst Ratings Best of Benzinga

Latest Ratings

StockFirmActionPT
AMDSusquehannaMaintains95.0
BABAOppenheimerMaintains335.0
EAJefferiesMaintains150.0
MELIJefferiesMaintains1,560.0
NOMDBTIGInitiates Coverage On30.0
View the Latest Analytics Ratings
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Premarket Activity
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Fintech Focus
A daily collection of all things fintech, interesting developments and market updates.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at vipaccounts@benzinga.com