Bed Bath & Beyond Reaches New All-Time Low With Legal Woes Approaching

Bed Bath & Beyond, Inc BBBY reached another new all-time low of 36 cents on Monday after it was reported former CEO Mark Tritton is suing the beleagured company for $6,765,000.

Tritton accuses Bed Bath & Beyond of failing to honor his severence agreement. The company also recently entered into a market offering program worth $300 million, which is bearish for the stock.

Bed Bath & Beyond plans to print its fourth-quarter earnings later this month but said it expects to report net sales of about $1.2 billion. The number comes in under the consensus estimate of $1.43 billion.

From a technical analysis perspective, the stock has no support in term of prior price history to the downside, meaning that only key psychological levels are in play.

Want direct analysis? Find me in the BZ Pro lounge! Click here for a free trial.

The Bed Bath & Beyond Chart: Bed Bath & Beyond is trading in a consistent downtrend, with the most recent lower high formed on March 24 at 88 cents and the most recent comfirmed lower low printed at the 76-cent mark on March 20. On Monday, Bed Bath & Beyond was looking to print a bearish Marubozu candlestick, which suggests lower prices could come again on Tuesday.

• Bed Bath & Beyond has traded lower over the last three trading days on higher-than-average bearish volume, which indicates the bears are in control and there is momentum to the downside. Bullish traders will want to watch for the stock to eventually begin to trade sideways on decreasing volume, which could indicate the next local low has occurred and a bounce is on the horizon.
• The eight-day and 21-day exponential moving averages (EMAs), are trending lower and curling to the downside, with the eight-day EMA under the 21-day. This indicates bearish price action is likely to continue unless the stock is eventualy able to regain the eight-day EMA as support.
• Bed Bath & Beyond has resistance above at 79 cents at $1.27 and psychological support below at 30 cents and the 25-cent mark.

Photo via Shutterstock.