Bed Bath & Beyond Tumbles After Forecast Trails Estimates
Bed Bath & Beyond Inc. (BBBY) fell the most since its stock market debut after forecasting fiscal second- quarter profit that was less than analysts’ estimated amid slowing same-store sales.
The shares declined 17 percent to $61.17 at the close in New York, for the biggest drop since the company first sold shares in a public offering in 1992. The Union, New Jersey-based company has gained 5.5 percent this year.
Profit per share in the quarter ending in August may be 97 cents to $1.03, the company said yesterday in a statement. The average of 24 analysts’ estimates compiled by Bloomberg was $1.08.
Bed Bath & Beyond said comparable-store sales in the first quarter rose 3 percent compared with 7 percent a year earlier. Analysts projected a gain of 3.8 percent, the average of five estimates compiled by Bloomberg.
“Despite the ongoing economic challenges that are affecting consumers, our fundamental business strategy remains unchanged: to offer a broad assortment of merchandise at everyday low prices with superior customer service,” Chief Executive Officer Steven Temares said during a conference call yesterday.
In May, Bed Bath & Beyond agreed to buy Cost Plus Inc. (CPWM) for $495 million in cash to add its World Market and Cost Plus Imports chains. The deal would give Bed Bath & Beyond 295 new stores along with another e-commerce platform to help it compete with retailers such as Amazon.com Inc. and Target Corp. (TGT)
Bed Bath & Beyond had 1,180 stores as of May 26.
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