Bed Bath & Beyond’s interim CEO is betting big — with her own money — that she can save the struggling retailer from going out of business, despite what some analysts are speculating.
Sue Gove purchased $230,500 worth of stock in the home goods retailer, according to a new SEC filing released after the close of trading on Wednesday.
Shares rose more than 20% in early trading on Thursday. The stock has crashed nearly 70% year to date following a string of poor results and failed turnaround strategies.
Gove, who was previously a board member, replaced ousted CEO Mark Tritton last week after another dismal quarter put the company’s financials in a very precarious position ahead of the crucial holiday shopping season.
Bed Bath & Beyond announced a quarterly adjusted operating loss of $224 million. The retailer ended the quarter with only $107 million in cash, prompting BofA analysts to issue a warning on the company’s liquidity position.
“Liquidity is now our top concern after the company burned over $500 million in 1Q,” BofA Analyst Jason Haas stated in a note titled: “BBBY’s liquidity circles the drain.”
The company also reported that it saw same-store sales crash 27% at its namesake brand in the most recent quarter as shoppers pulled back on discretionary purchases. Shoppers also continued to shun the retailer’s move to scale back coupons.
Gove’s immediate to-do list regarding the effort to save the company is plentiful.
First, the veteran retail executive must stabilize the company. That is likely to include the long sought after sale of the buybuy Baby store chain, the return of more name brands to stores (which should alleviate supply chain issues), and a steadier cadence of discounts to win back customers.
Gove may also have to raise cash through new debt or a share issuances to temper concerns among vendors about getting paid for their goods.
And lastly, Gove must gain the support of key shareholders like GameStop chairman Ryan Cohen. Cohen (who is indeed still a BBBY shareholder, a source tells Yahoo Finance) has been agitating for change at Bed Bath & Beyond for months. It’s clear his concerns haven’t really been heard at the same time in which the value of his investment has gone sharply lower. Not a good look.
Winning over the retail investor influencer Cohen — who has been taking thinly veiled shots at Bed Bath & Beyond on Twitter since the executive upheavel last week — is important.
Even if Gove manages to pull off this long list within 12-months, analysts covering the company think that the business is toast.
“We are looking at a situation in which this company is probably not going to be around,” Loop Capital Analyst Anthony Chukumba told Yahoo Finance Live (video above). “It’s not going to take years. We could be talking about months at this point. We are in the end days. These results were a dumpster fire. There is no other way to put it.”
Gove is literally betting on analysts, including Chukumba, being wrong.
This post has been updated with the latest stock move.
BofA Securities maintains Amazon.com at ‘buy’ with a price target of $154.00
Six people in critical condition, one still missing after Paris blast – prosecutor
© Reuters. French firefighters and rescue forces work after several buildings on fire following a gas explosion in the fifth arrondissement of Paris, France, June 21, 2023. REUTERS/Gonzalo Fuentes
PARIS (Reuters) – Six people remained in a critical condition and one person was believed still missing on Thursday, one day after a blast ripped through a street near Paris’ historic Latin Quarter, the city’s public prosecution office said. “These figures may still change,” prosecutor Maylis De Roeck told Reuters in a text message, adding that around 50 people had been injured in the blast, which set buildings ablaze and caused the front of one to collapse onto the street. Of two people initially believed missing, one has been found in hospital and is being taken care of, the prosecutor said, adding: “Searches are ongoing to find the second person.” Authorities have not yet said what caused the explosion, which witnesses said had followed a strong smell of gas at the site. The explosion led to scenes of chaos and destruction in the historic Rue Saint Jacques, which runs from the Notre-Dame de Paris Cathedral to the Sorbonne University, just as people were heading home from work. It also destroyed the facade of a building housing the Paris American Academy design school popular with foreign students. Florence Berthout, mayor of the Paris district where the blast occurred, said 12 students who should have been in the academy’s classrooms at the time had fortunately gone to visit an exhibition with their teacher.
“Otherwise the (death toll) could have been absolutely horrific,” Berthout told BFM TV. She said three children who had been passing by at the time were among the injured, although their lives were not in danger.
4 big analyst cuts: Alcoa & DigitalOcean shares drop on downgrades
Here is your Pro Recap of the biggest analyst cuts you may have missed since yesterday: downgrades at Alcoa, DigitalOcean, Teleflex, and Xcel Energy.InvestingPro subscribers got this news in rapid fire. Never be left in the dust again.Alcoa stock drops on Morgan Stanley downgrade Alcoa (NYSE:) shares fell more than 3% pre-market today after Morgan Stanley downgraded the company to Underweight from Equalweight and cut its price target to $33.00 from $43.00, as reported in real time on InvestingPro.The firm sees a significant decline in consensus estimates, and as negative earnings revisions materialize, it believes the stock will face downward pressure and underperform.The analyst’s estimates for EBITDA in Q2, 2023, and 2024 are substantially lower than the consensus. The stock is currently trading above its historical average. The firm said its downward revisions in earnings estimates and price target are attributed to the company’s high operating leverage to aluminum prices.DigitalOcean stock plunges on downgradePiper Sandler downgraded DigitalOcean (NYSE:) to Underweight from Neutral with a price target of $35.00. As a result, shares plunged more than 5% pre-market today.The company reported its last month, with revenue beating the consensus estimate, while EPS coming in worse than expected. Furthermore, the company provided a strong outlook, which was above the Street estimates.2 more downgradesTeleflex (NYSE:) shares fell more than 3% yesterday after Needham downgraded the company to Hold from Buy, noting that UroLift expectations may still be too high.According to Needham, their checks indicate that urologists are reducing their use of UroLift due to its retreatment rates, reimbursement cuts, and increasing use of competing procedures. This is also supported by their Google Trends data analysis, which indicates decreasing search interest in UroLift.BMO Capital downgraded Xcel Energy (NASDAQ:) to Market Perform from Outperform and cut its price target to $64.00 from $69.00 to reflect the lower-than-expected terms of the company’s regulatory settlement in Colorado.Amid whipsaw markets and a slew of critical headlines, seize on the right timing to protect your profits: Always be the first to know with InvestingPro.Start your free 7-day trial now.
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