Wedbush Morgan Keeps Buy on Bed Bath & Beyond

Analyst Joan Storms believes the home merchandiser has strong earnings power and still-signficant growth ahead

Wedbush Morgan keeps buy on Bed Bath & Beyond (BBBY ).

Analyst Joan Storms says fourth-quarter earnings per share beat her and consensus estimates by 4 cents on strong operating metrics. She reiterates her buy on strong earnings power and re-acceleration of the company's comparative sales and easier comparisons in fiscal 2006 and still-significant growth ahead.

She notes the company guided to fiscal 2006 (ending February) earnings per share of $1.87, including 8 cents to 9 cents of lease and option expenses. As such, she trims her $1.89 fiscal 2006 earnings per share estimate to $1.87, including her lease and option expenses.

Storms sees $2.15 fiscal 2007, which she believes is conservative. She says Bed Bath & Beyond is attractively valued, trading at discount to her 23% long-term growth rate estimate.

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