- Raymond James analyst Bobby Griffin has reiterated an Underperform rating on the shares of Bed Bath & Beyond Inc BBBY.
- The analyst said the company’s Q2 sales were relatively in-line with its August 31 business update, while adjusted EBIT came in below his and consensus expectations, primarily driven by higher-than-anticipated SG&A.
- He added that the management reaffirmed its FY22 guidance elements given during its business update as its recent initiatives (national brand inventory build, SG&A cuts, etc.) have not yet materially impacted results.
- Griffin specified while Bed Bath & Beyond’s improved liquidity position gives new management some additional time, it likely only ‘kicks the can down the road’ as underlying business trends remain very challenging.
- Also Read: Winning Consumers Back Will Be Challenging For Bed Bath & Beyond, Says This Analyst
- Even with a move back towards more branded products, Griffin struggles to see a pathway for improved performance, especially with discretionary consumer spending and housing slowing further in the second half of 2023.
- The ongoing cash burn and need to preserve cash/liquidity, the analyst says, will limit in-store investments, likely only further hindering customer traffic and the brand perception with younger consumers.
- Price Action: BBBY shares are trading higher by 0.89% at $6.24 on the last check Friday.
- Photo Via Company
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