Retailer Launches Customer Upgrades Ahead of Earnings

Bed Bath & Beyond will report earnings on September 30

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Bed Bath & Beyond Inc. (NASDAQ:BBBY) is an American chain of domestic merchandise retail stores. BBBY sells a wide assortment of merchandise in the home, baby, beauty, and wellness markets. Bed Bath & Beyond operates stores in the United States, Canada, Mexico, and Australia. This afternoon, BBBY was last seen down 3.2% at $23.36.

On Sept. 15, Bed Bath & Beyond announced the launch of the Home, Happier Team, a curated advisory panel of industry experts who will provide ideas, solutions, and content to help customers personalize their living space. BBBY's Home, Happier Team members include culinary personality Katie Lee Biegel, interior designer Jeremiah Brent, storage and organization expert Eryn Donaldson, and sleep wellness specialist Dr. Shelby Harris. The new team will make its debut at Bed Bath & Beyond's in New York City on Oct. 2 during a week-long Open House event.

Bed Bath & Beyond is also slated to release its fiscal second-quarter earnings on Thursday, September 30. BBBY has beat earnings expectations on just two of its last four reports. Wall Street analysts currently expect Bed Bath & Beyond stock to report earnings of $0.52.

For its fiscal second quarter of 2020, the home accessories brand beat analyst estimates by a margin of $0.73, reporting an EPS of $0.50. For Q3 of 2020, Bed Bath & Beyond's EPS decreased to $0.08, missing expectations by a margin of $0.11. For Q4, BBBY posted an increase in earnings, rising to $0.40 per share. The retail company also beat estimates by a margin of $0.09. Most recently, for Q1 of 2021, Bed Bath & Beyond reported an EPS of $0.05 and missed expectations by a margin of $0.03.

Bed Bath & Beyond stock has increased about 85% in price year-over-year and is up 100% since bottoming at its record low of $12.07 this time last year. Additionally, shares of BBBY have grown 34% year-to-date, but remain down 55% after spiking to a nearly six-year high of $53.90 at the end of January.

Bed Bath & Beyond stock has potential as a recovery play despite its inflated price-earnings ratio of 28.30. In addition, Bed Bath & Beyond stock's forward price-earnings ratio of 16.29 suggests a significant growth in earnings.

An unwinding of optimism in the options pits could weigh on the shares. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), the stock sports a 50-day call/put volume ratio of 3.27, which ranks in the 89th annual percentile and shows calls more than doubling puts during the past 10 weeks.


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