Bed Bath & Beyond shares plunge 29% on lowered sales outlook as COVID-19 cuts into shopper traffic
Getty/Kevork Djansezian
- Bed Bath & Beyond stock tanked nearly 30% Thursday after the retailer's second quarter financial results.
- The housewares seller's quarterly sales of $1.99 billion missed expectations of $2.06 billion.
- It cut its yearly sales outlook as COVID-19 concerns stoked lower foot traffic in big states such as Texas.
- See more stories on Insider's business page.
Bed Bath & Beyond shares lost nearly a third of their value Thursday after the housewares retailer cut its yearly profit forecast, with second-quarter sales hurt by the ongoing COVID-19 pandemic.
The stock fell as much as 29% to $15.70, the lowest price in exactly one year. The plunge was on course to wipe out what had been a year-to-date gain of 25% through Wednesday.
Investors drove down shares after the company said it now expects net sales of $8.1 billion to $8.3 billion for the fiscal full-year 2021. The guidance compared with its previous call for sales of as much as $8.4 billion.
The revision followed a 26% drop in second-quarter sales to $1.99 billion that missed the $2.06 billion consensus estimate from FactSet. Sales took a hit particularly in August as foot traffic at stores "slowed significantly," the company said, adding that August is the largest month in its second quarter.
"As COVID-19 fears re-emerged amid the on-going Delta variant, we experienced a challenging environment," with slower sales showing up in large states such as Florida, Texas and California.
It also flagged unprecedented supply chain issues and rising costs as factors that led to lower-than-anticipated results. Same-store sales during the quarter fell 1%. Adjusted earnings of $0.04 a share came in far below an estimated $0.52 a share.
Bed Bath & Beyond forecast same-store sales to be flat to up slightly through the fourth quarter of fiscal 2021.
The company said it has made progress in its ongoing three-year turnaround program.
"Our buybuy BABY banner continued to build on its positive momentum from the past several quarters, growing double digits due to strength in apparel and travel gear and increasing market share for the period," it said.
from Business Insider https://ift.tt/2ZMqPjS
No comments