Big Lots Stock Sinks on Heels of Earnings Miss

The security is down more than 39% in the last 12 months

Deputy Editor
Mar 3, 2022 at 10:29 AM
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Big Lots, Inc. (NYSE:BIG) stepped into the earnings confessional this morning, reporting fourth-quarter profits that fell short of Wall Street's estimates. The retailer posted adjusted earnings of $1.75 per share, lower than the $1.89 forecasted by analysts, though revenue of 1.73 billion edged out the $1.72 billion expectation. The disappointing profits were attributed to the impact of recent inclement weather, spikes in omicron cases, and inventory delays amid supply chain disruptions.

Following this lackluster earnings turnout, BIG was last seen down 1.7% to trade at $36.60 at last check. The shares have pulled back since moving as high as $50.87 in early January, falling to an almost two-year low of $31.57 on Feb. 24. Longer term, Big Lots stock sports a 39.2% year-over-year deficit.

Options traders are moving in after the event, and the 655 puts that have exchanged hands so far today is double the amount typically seen at this point. The most popular positions by far is the March 37.50 put, followed by the 35 put from the same monthly series.

Analysts have yet to weigh in on earnings, but the entire brokerage bunch leans pessimistic on the security, with all seven in coverage recommending a "hold" or worse rating. This suggests a slew of upgrades is overdue on the security. 

Meanwhile, short interest saw a 36.8% jump over the last two weeks, and the 7.94 million shares sold short now make up a staggering 27.9% of the stock's available float. In other words, it would take more than seven days to buy back these bearish bets, at BIG's average pace of daily trading. 


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