Bed Bath & Beyond Jumps After It Tops Estimates, Starts Dividend

Bed Bath & Beyond Quells Investor Fears

Bed Bath & Beyond Inc. gained as much as 8.6 percent in late trading after posting better-than-expected results and announcing a quarterly dividend, easing concerns that the retailer is losing ground to online rivals.

Excluding some items, earnings amounted to $1.85 a share in the fourth quarter, which ended Feb. 27, the company said in a statement Wednesday. Analysts had predicted $1.81 on average. Sales rose to $3.42 billion, topping the $3.38 billion estimate.

The results helped restore faith in the company after a rocky start to the holiday season sparked investor fears. Analysts cut their ratings of the retailer in the wake of its third-quarter results, and the stock tumbled. The company’s strength -- home goods and bathroom supplies -- puts it in the cross hairs of e-commerce sites such as Inc.

To placate shareholders, Chief Executive Officer Steven Temares has been revamping the business and returning cash to investors. In addition to share repurchases, Bed Bath & Beyond said on Wednesday that it would initiate a quarterly dividend of 12.5 cents a share.

Still, growth remains muted. The company expects same-store sales to increase 1 percent to 2 percent this quarter. They gained 1.7 percent on that basis last quarter. Analysts had estimated 0.8 percent.

The stock rose as high as $53 in extended trading after the results were released. Bed Bath & Beyond had been up 1.2 percent this year through Wednesday’s close.

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