Bed Bath & Beyond (NASDAQ:BBBY) stock may not make it through 2023.
Anthony Chukumba, managing director of Loop Capital in Chicago, warned reporters this week that this holiday season was the home goods retailer’s final test, and that it failed the test.
The stock barely budged in pre-market trading on Dec. 29, but it’s down almost 90% since August when it held a “strategic update” and announced a turnaround plan. The plans of interim CEO and director Sue Gove initially drew investor interest, but many analysts were skeptical even then.
It seems they were right to be.
What the Analysts Know
Chukumba is a retail industry analyst who follows many companies beyond BBBY. Most, like Best Buy (NYSE:BBY), have had a rough holiday but should get by. Bed Bath & Beyond, he says, won’t. “All you need to know is that they’re just simply not relevant anymore,” he told Yahoo Finance.
Until late in the last decade, Bed Bath & Beyond was known for offering low prices on brand-name goods. Under Mark Tritton, a former Target (NYSE:TGT) executive, it tried to become a curator of high-end store brands. But the pandemic intervened, consumers became confused, and Tritton was let go.
Bed Bath & Beyond last reported results on Sept. 29, a loss of $366 million, $4.59 per share, on sales of $1.437 billion. It’s next due to report on Jan. 5, but that will only cover sales through November.
The final numbers for the full holiday season may not be out until April. Analysts are already warning they are not good. Online sales during “Cyber Monday” were off 25% from the previous year, soon after insider Scott Lindblom was promoted to chief technology officer. More recently the company got a new chief legal officer, David Kastin, whose experience includes stints at a vitamin retailer and a cannabis company.
BBBY Stock: What Happens Next?
The market capitalization of BBBY is already below $300 million, on what should still be sales of $6 billion. In most industries, that’s called a bargain. In retail, it’s what happened to Sears and JCPenney.
On the date of publication, Dana Blankenhorn held no positions in any companies mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.