Dear BBBY Stock Fans, Mark Your Calendars for April 26

Advertisement

  • Bed Bath & Beyond (BBBY) must file its Form 10-K by April 26.
  • The retailer must also complete its common stock offering by that date.
  • BBBY stock is down more than 80% year-to-date (YTD).
The front view of a Bed Bath & Beyond (BBBY) retail location in Indianapolis, Indiana.
Source: Jonathan Weiss / Shutterstock.com

Bed Bath & Beyond (NASDAQ:BBBY) stock has fallen more than 80% year-to-date (YTD). Now, an upcoming deadline has shareholders further on edge. The struggling home goods retailer has until April 26 to file its annual report, or Form 10-K.

The filing of this report is significant because the company must evaluate whether or not it remains a “well-known and seasoned issuer.” That designation will allow Bed Bath to act out on a $300 million common stock offering announced last week in coordination with B. Riley Securities. In order to qualify as a seasoned issuer, Bed Bath must have a public float of at least $700 million during the past 60 days, among other requirements. Bed Bath implied that it does not believe it will meet the requirements.

As the company explained:

“Upon filing our annual report on Form 10-K, which is due by April 26, 2023, we will lose S-3 eligibility and therefore we expect all sales made pursuant to the sales agreement will cease by April 26, 2023. If we do not receive the proceeds from the offering of securities covered by this prospectus supplement, we expect that we will likely file for bankruptcy protection, in which case holders of our common stock will likely receive no recovery at all for the securities offered by this registration statement.”

Dear BBBY Stock Fans, Mark Your Calendars for April 26

Bed Bath & Beyond noted that it will use the proceeds from the offering toward paying off outstanding credit facilities and to operate day-to-day business. The company warned that a failure to consummate the offering in whole could result in a bankruptcy protection filing. Bed Bath currently owes $101.5 million under its credit facilities and $105.6 million in letters of credit. Shareholders are also at risk because of the dilutive nature of the offering.

“Under the circumstances, we caution you against investing in our common stock, unless you are prepared to incur the risk of incurring substantial losses,” warned Bed Bath & Beyond.

The situation certainly seems bleak for the retailer. According to DataWeave, the availability of products in Bed Bath stores is “46% of the level a year earlier.” On top of that, the company has closed hundreds of stores in the past year.

Investors would be smart to stay on the sidelines with BBBY stock until the dust has subsided, which could ultimately result in a bankruptcy.

On Penny Stocks and Low-Volume Stocks: With only the rarest exceptions, InvestorPlace does not publish commentary about companies that have a market cap of less than $100 million or trade less than 100,000 shares each day. That’s because these “penny stocks” are frequently the playground for scam artists and market manipulators. If we ever do publish commentary on a low-volume stock that may be affected by our commentary, we demand that InvestorPlace.com’s writers disclose this fact and warn readers of the risks.

Read More:Penny Stocks — How to Profit Without Getting Scammed

On the date of publication, Eddie Pan did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.


Article printed from InvestorPlace Media, https://investorplace.com/2023/04/dear-bbby-stock-fans-mark-your-calendars-for-april-26/.

©2024 InvestorPlace Media, LLC