Replies to post #11521 on Keeping It Simple

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31.45 GAP on BBBY

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BBBY

26.39

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BBBY

Always a curiousity... Why is something higher after Covid then it was before Covid?



16.01 2/7/20 pre covid
4.60 4/3/20 shut down/covid
53.90 1/29/21 after covid : (note - a PPS Last seen prior in 11/2015 when yrly eps was 5.03)

Its extraordinary. These are very weird times. LOL

cpps: 23.79 (15.38 gap)

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Bed Bath & Beyond up sharply today as activist investor discloses large stake
Briefing.com - 12:14 PM ET

Bed Bath & Beyond (BBBY +29%) is surging today on reports that investment firm RC Ventures disclosed that it now owns nearly 10% of the home goods retailer and that the firm wants management to undergo a strategic review.

Activist investor announcements like this one are fairly common. Kohl's (KSS) and Macy's (M) are other recent names that have found themselves in the crosshairs of activist investors. However, a move of the size that the stock is making today is not a typical response. RC Ventures holds a lot of sway with investors. It is owned by billionaire Ryan Cohen, the co-founder of Chewy.com (CHWY), so it holds a lot of credibility. Also, RC Ventures is known for being aggressive as a stakeholder. A few years ago, it took a similar action with GameStop (GME), which now has a new CEO and where Mr. Cohen himself now sits as chairman. Plus, RC Ventures' stake in BBBY is a large one at nearly 10%. RC Ventures' main concerns are that BBBY is overpaying executives and failing to reverse market share losses. It wants the retailer to narrow its focus to improve its operations and inventory mix. The firm also wants BBBY to undergo a review of strategic alternatives, which could lead to a sale of the whole company or perhaps to a spin-off of its better performing buybuy BABY segment. We have to admit that BBBY has been frustrating over the years, as it has been caught up in seemingly endless turnaround efforts. In late 2019, it hired Target (TGT) executive Mark Tritton as CEO. One of the main challenges that BBBY has been facing is combatting online retailers like Amazon (AMZN). Target has done a great job in this regard, so we were excited by that hire. He has made important changes, and more time is warranted to see if those changes will be effectual, but the clock is ticking.
Bottom line, we are generally fans of seeing activist investors spur shake-ups. Sometimes management needs to be reminded to challenge their assumptions and think outside the box. Activist input lights a fire to improve their performance.

Our take on BBBY is that its stores are too big and perhaps too many in number. We do like that BBBY has been focusing more on digital sales, on its proprietary brands, and on store-within-a-store concepts, like it recently did with Kroger (KR). We also think the buybuy BABY banner, which has been outperforming the core banner, could make sense as a spin-off or sale candidate. We do not see a lot synergies there, and a sale could generate cash.

It is always difficult to predict what an activist push will achieve. Some go nowhere or result in compromises. However, we do think that for smart, institutional investors to prod management to improve performance is always welcome.

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Ryan Cohen Scores $656 Million For Himself By Doing Nothing

https://www.investors.com/etfs-and-funds/sectors/ryan-cohen-scores-millions-for-himself-by-doing-nothing-bbby-gme/?src=A00220

MATT KRANTZ02:29 PM ET 03/07/2022
Ryan Cohen has yet to make any material difference to GameStop (GME). But he's making a giant improvement to his own portfolio: $656 million, also thanks to Bed Bath & Beyond (BBBY).

In less than two years, Cohen, the 35-year-old founder of online pet store Chewy (CHWY), has made more than $650 million on his investments in GameStop and now Bed Bath & Beyond. It's part of an effort for the young investor to find deeply distressed stocks, announce his involvement, and watch the gains roll in. The way investors pile into stocks Cohen is involved in is similar to bump-ups enjoyed by those Warren Buffett or Carl Icahn invest in.

Shares of Bed Bath & Beyond surged more than 30% Monday on the regulatory filing showing Cohen took a 9.5 million share stake in the company's stock. That amounts to roughly 10% of the retailer's 95.8 million shares outstanding. Cohen is pushing the board to make changes to the business. Shares of the home goods seller, part of the "meme stock" rebellion, had been down nearly 50% in the past 12 months. The S&P 500 in that time is up more than 13%.

But Cohen is showing an uncanny ability to make money for himself just throwing his name around.

Cohen Scores On GameStop As Others Suffer
Cohen's biggest score is still GameStop. And that's even while his personal involvement as chairman has yet to pay off in any fundamental way.

He's now hauled in $600 million in gains on his three purchases of the struggling video-game seller. His initial purchase of 6.5 million shares in September 2020 rocketed nearly 1,000% in value, putting more than $600 million into his pocket. His second buy in late 2020 is now up more than 300% to a gain of $106 million.

But reality is setting in. Shares of GameStop are now down more than 40% in a year's time. And that's despite Cohen's big plans for the company. Cohen took over as director of the company on Jan. 11, 2021. And he's vowed to launch GameStop into digital businesses like non-fungible tokens (NFTs) and online games distribution. And yet, the company lost an adjusted $138.8 million, or $2.14 a share, in 2021. That actually reversed a $19.1 million, or 22 cents a share gain, in 2020. Revenue in 2021 also dropped more than 20%.

Analysts don't see much improvement. The company is seen losing $122.97 million, or $1.69 a share, in 2022. And losing money again in 2023. And Cohen is now down roughly $107 million on his third GameStop investment in the first quarter of 2021.


The Cohen-Effect At Bed Bath & Beyond
Now, it's Bed Bath & Beyond's turn to fell the "Cohen effect."

Cohen pocketed more than $53 million on his 9.5 million share stake in Bed Bath & Beyond based on the date that disclosure was required, on Feb. 24. He's been accumulating shares since early this year. And again, he hasn't done anything yet to improve the company's fortunes.

He did, though, issue a strongly worded letter to the company's board. He's calling for change at the company, but holds no managerial role there. "In March 6, 2022, the Reporting Persons delivered a letter to the Board (the "Letter") encouraging the Board to adjust the Issuer's strategy and explore alternative paths to value creation. Specifically, the Reporting Persons expressed their belief that the Issuer should narrow its focus to fortify operations and maintain the right inventory mix to meet demand, while simultaneously exploring strategic alternatives that include separating buybuy Baby, Inc. and a full sale of the Issuer," the filing said.

But when your name alone is worth millions, it's the announcement that matters most.

______________________________________________________________

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BBBY

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Bed Bath & Beyond stock pulls back after analyst says investors should sell, citing ‘unrealistic’ valuation

https://www.marketwatch.com/story/bed-bath-beyond-stock-pulls-back-after-analyst-warns-investors-to-sell-citing-unrealistic-valuation-11660655737?siteid=yhoof2

HAHAHAHAHAH! DYING! Some times this stuff is just too funny. Bet they wish they didn't toss this one to print!


Last Updated: Aug. 16, 2022 at 9:19 a.m. ET
First Published: Aug. 16, 2022 at 9:15 a.m. ET
By Tomi Kilgore

B. Riley’s Susan Anderson joins the majority of bearish analysts, as stock price target implies near-70% downside

Shares of Bed Bath & Beyond Inc. took a breather Tuesday (Wait? Isn't today Tuesday? So Yes - for one hot second) , after B. Riley analyst Susan Anderson warned investors that they should sell, saying their recent rocket ride has led to “unrealistic” valuations.

The stock BBBY, 33.38% fell 4.7% in premarket trading Tuesday (and now its up 42% in trade) , after soaring 50.5% over the past two days. The meme stock has skyrocketed 248% over a 14-day stretch in which it rose in 13 of the days.

B. Riley’s Anderson cut her rating to sell from neutral while affirming her $5 stock price target, which implies 68.8% downside from Monday’s close of $16.

She said the downgrade comes after the stock (BBBY) more than tripled since the home goods retailer reported “very weak” fiscal first-quarter results that led to the ouster of its chief executive officer.

“BBBY has recently gained the attention of retail traders in the Wall Street Bets Reddit forum again, which gained notoriety during the GameStop saga back in January 2021,” Anderson wrote in a note to clients. “We believe BBBY is currently trading at unrealistic valuations.”

On a bright side, she said the rally could provide the company with a “long-term lifeline,” as prior meme-stocks, such as GameStop Corp. GME, -1.71% and AMC Entertainment Holdings Inc. AMC, -2.44%, have used the Wall Street Bets boost to raise cash through at-the-money stock sales.

Anderson became the 11th analyst of the 19 surveyed by FactSet that are bearish on Bed Bath & Beyond’s stock. Only one analyst is bullish and the other seven are neutral. The average stock price target is $3.49, implying 78.2% downside from Monday’s close.

Bed Bath & Beyond shares have advanced 9.7% year to date through Monday but have tumbled 41.9% over the past 12 months. In comparison, the SPDR S&P Retail exchange-traded fund XRT, 1.26% has lost 25.3% over the past year and the S&P 500 index SPX, -0.29% has slipped 4.1%.

Now it really reminds me of AMC

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Bed Bath & Beyond’s 75% Surge Extends Huge Rally, Defies Bears
A 510% jump in shares comes as analysts downgrade the stock
Short sellers hit with $662 million in paper losses this month
https://www.bloomberg.com/news/articles/2022-08-16/bed-bath-beyond-s-510-surge-defies-wall-street-naysayers#xj4y7vzkg
ByBailey Lipschultz
August 16, 2022 at 9:39 AM MDTUpdated onAugust 16, 2022 at 11:40 AM MDT

The 510% three-week surge by Bed Bath & Beyond Inc., which has helped reinvigorate a wave of meme stock buying, stands in the face of Wall Street banks sounding the alarm on the stock’s lofty valuations.

The buying spree extended on Tuesday as the stock soared as much as 79% to $28.60 and triggered a pair of trading halts when more than 273 million shares changed hands to make it the most actively traded stock, Bloomberg data show. Call options betting on the stock to trade above $45 by the end of the week and others that would be in-the-money if it traded at $80 by mid-January were the most active derivatives tied to the stock, according to data compiled by Bloomberg

The surge has come even as at least three Wall Street banks downgraded the home-goods company and recommended investors sell the stock amid the “meme stock frenzy.” Susan Anderson at B Riley Securities earlier on Tuesday cut her rating to sell from neutral, and called the retailer’s $2 billion valuation “unrealistic.” Baird’s Justin Kleber downgraded shares last week, before the stock’s latest burst, warning the “fundamental risk/reward looks unattractive” with market share losses accelerating and the company burning cash.

None of that stopped the surge in buying from the retail trading crowd which has pushed $99 million into the stock since July 26, according to data compiled by Vanda. The net inflow includes a record $46 million on Monday when the stock spiked 24% to close at the highest since late April, the data show.

Bed Bath & Beyond short sellers have been slammed to the tune of $662 million in mark-to-market paper losses this month, including a $218 million blow Tuesday, data from analytics firm S3 Partners show. The stock is “very squeezable” given the crowded short positions, and will likely be driven even higher as short sellers are forced to cover their bets, S3 Partners managing director of predictive analytics Ihor Dusaniwsky said by email.

Fellow meme stocks GameStop Corp. and AMC Entertainment Holdings Inc. also saw a burst in activity. The video-game retailer spiked as much as 15%, triggering a trading halt, as the movie-theater operator erased losses to rise 2%.

Bed Bath & Beyond was the most bought asset on Fidelity’s platform at 1 p.m. in New York. Its ticker was the most mentioned on Reddit’s WallStreetBets and was trending on popular chatroom StockTwits.

Even after the surge, the stock remains down 50% from a January 2021 peak, and analysts see more losses on the horizon. The average 12-month price target of $4.49 implies a more than 80% drop from current levels, Bloomberg data show. Two-thirds of analysts recommend investors sell shares, the largest number in at least a decade.

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Track : BBBY Open Gaps
Direction Date range
up Aug-15-2022 13.28 to 13.37
up Aug-08-2022 8.29 to 10.75 (interesting)
up Aug-05-2022 6.49 to 6.5201 (pretty meaningless)

biti is thinking 5 - dead cat bounce.

https://investorshub.advfn.com/boards/read_msg.aspx?message_id=169726345

Which would be a hoot! I could do this shit right this time. Quantity.

I would bite into that, should it happen.

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BBBY 11.91

5 day curr @ 11.28

20 d curr @ 11.97

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Bed Bath & Beyond Inc. Announces Strategic Changes to Strengthen its Financial Positioning, Drive Growth and Better Serve Customers

August 31 2022 - 07:30AM
PR Newswire (US)

https://ih.advfn.com/stock-market/NASDAQ/bed-bath-and-beyond-BBBY/stock-news/88954587/bed-bath-beyond-inc-announces-strategic-changes

UNION, N.J., Aug. 31, 2022 /PRNewswire/ -- Bed Bath & Beyond Inc. (NASDAQ: BBBY) today announced a strategic and business update focused on changes intended to meet the demand of its customers, drive growth and profitability, and improve its balance sheet and cash flows.

Sue Gove, Director & Interim Chief Executive Officer commented, "We are embracing a straight-forward, back-to-basics philosophy that focuses on better serving our customers, driving growth, and delivering business returns. In a short period of time, we have made significant changes and instituted enablers across our entire enterprise to regain our dominance as a preferred shopping destination for our customers' favorite brands and exciting products. We command a special presence in the Home and Baby markets, and we intend to fulfill our opportunity to be the category retailer of choice."

Ms. Gove continued, "We are working swiftly and diligently to strengthen our liquidity and secure our path for the future. We have taken a thorough look at our business, and today, we are announcing immediate actions aimed to increase customer engagement, drive traffic, and recapture market share. This includes changing our merchandising and inventory strategy, which will be rooted in National Brands. Additionally, we are focused on driving digital and foot traffic, as well as optimizing our store fleet. We believe these changes will have a widespread positive impact across customer experience, inventory assortment, supply chain execution and cost structure. The customer underpins our decisions, and we are committed to delivering what they want while driving growth, profitability, and financial returns."

Strengthening Our Financial Positioning

Liquidity

The Company announced it has secured financing commitments for more than $500 million of new financing, including its newly expanded $1.13 billion asset-backed revolving credit facility ("ABL facility") and a new $375 million "first-in-last-out" facility ("FILO facility"). The refinancing of the ABL Facility is being led by J.P. Morgan, and Sixth Street Partners is serving as the Lender and Agent for the Company's FILO facility. The commitments are subject to customary closing conditions. There is no guarantee that the closing conditions will be satisfied, however, the Company anticipates that the closing and funding of the loans will occur imminently.

Additionally, the Company filed a Form S-3 Registration Statement with the SEC earlier this morning as it prepares for the potential launch of an at-the-market offering program ("ATM") for up to 12 million shares of common stock. The potential proceeds from an ATM are expected to be used for a number of corporate purposes, including to repurchase or repay some of the Company's debt.

Cost Structure

The Company has begun implementing significant, additional SG&A reductions to right-size its cost structure. These reflect the Company's immediate priorities of merchandising, inventory, and traffic, and also align with changes in store footprint, lower Owned Brands development and support, and deferral of longer-term strategic initiatives. Cost optimization plans include a reduction in force, including approximately 20% across corporate and supply chain.

The Company expects the actions announced today to reduce SG&A by approximately $250 million in fiscal 2022.

Additionally, the Company has further reduced its plan for capital spending. In fiscal 2022, planned capital expenditures are now forecasted to be $250 million, compared to the $400 million previously disclosed, and are expected to provide sufficient strategic investment in technology, digital capabilities and offerings, and store maintenance.

Real Estate and Store Fleet Optimization

The Company has identified and commenced the closure of approximately 150 lower-producing Bed Bath & Beyond banner stores. The Company continues to evaluate its portfolio and leases, in addition to staffing, to ensure alignment with customer demand and go-forward strategy.

Better Serving Our Customers

Merchandising and Inventory

Customers are expected to benefit from swift actions the Company is taking in its Bed Bath & Beyond banner to rebalance its assortment and improve inventory. These include adjusting merchandise allocations to lead with customer preference and bringing back popular national brands and introducing new, emerging direct-to-consumer brands. The Company is working expeditiously to increase its National Brands inventory where possible and will increase inventory penetration by 20 percentage points over the long term.

Accordingly, the Company will be exiting a third of its Owned Brands by discontinuing three of its nine labels (Haven™, Wild Sage™ and Studio 3B™). The breadth and depth of inventory across the Company's six remaining Owned Brands (Simply Essential™, Nestwell™, Our Table™, Squared Away™, H for Happy™ and Everhome™) will be substantially reduced to 20 percentage points, reflecting a more balanced sales to stock ratio moving forward.

Customer Engagement

The Company plans to leverage its recently introduced, cross-banner loyalty program, Welcome Rewards™ to drive traffic, sales, and customer retention. Welcome Rewards™ brings valuable savings, more benefits, and special perks to customers who shop online and in stores nationwide at Bed Bath & Beyond, buybuy BABY, and Harmon. Customers earn and redeem points across all three retail banners with every purchase across all retail channels and banners. Since recently launching nationally, the program has seen strong momentum with five million total members, increasing new membership by 20%.

Supporting Suppliers and Vendor Partners

The Company's teams are working closely with supplier and vendor partners to ensure customers have access to a strong assortment of their favorite brands across both store and digital channels. The Company will host a supplier event in early-Fall 2022 to build on new and strengthen existing relationships, address any issues to ensure strong support, and work collaboratively to create the best experience for shared customers.

Building on the Strength of buybuy BABY

The Strategy Committee of the Board of Directors, with the assistance of independent strategic and financial advisors, has completed a comprehensive review of the inherent value of the Company's buybuy BABY banner, which confirmed the banner's strategic potential. The Board of Directors believes that, at this time, buybuy BABY will deliver greater value for the Company's shareholders as part of the Bed Bath & Beyond Inc. portfolio. The Board of Directors and management team have identified several strategies to implement impactful, organic changes to accelerate further growth and unlock the brand's full potential including building on its digital and registry platforms, addressing additional age groups and expanding products and services. The Board of Directors' Strategy Committee will continue to monitor the buybuy BABY business as it preserves optionality and future value creation.

Leadership Changes
The Company has realigned its executive leadership team to reflect the strategic priorities and changes announced today. Mara Sirhal has been appointed to Executive Vice President and Brand President of Bed Bath & Beyond. In addition, Patty Wu has been promoted to Executive Vice President and Brand President of buybuy BABY. The newly created Brand President roles will be responsible for each banner's merchandising, planning and allocation, brand marketing, and stores, and will report directly to Ms. Gove.

Ms. Sirhal most recently served as the Company's Executive Vice President and Chief Merchandising Officer for the Bed Bath & Beyond banner. Ms. Sirhal joined the Company in January 2021 as Senior Vice President and General Manager for Harmon to lead all operational aspects of this business. Ms. Sirhal's retail experience includes nearly 20 years across a variety of categories in merchandising, product development, planning, digital, inventory management, supplier diversity, and leased businesses at Macy's, Inc.

Ms. Wu has served as the Senior Vice President and General Manager of buybuy BABY since joining the Company in January 2021. Prior to buybuy BABY, Ms. Wu held several executive leadership positions across retail and business, including the roles of Chief Commercial Officer of Beautycounter, Chief Commercial Officer and General Manager of the Baby Division at The Honest Company, as well as senior management roles at Mattel, Inc. and Walmart.

In conjunction with these changes, the Company has eliminated the Chief Operating Officer and Chief Stores Officer roles. Accordingly, John Hartmann and Gregg Melnick will be departing the Company.

CEO Search
Harriet Edelman, Independent Chair of the Bed Bath & Beyond Inc. Board of Directors, said: "It is clear from the focused work to date, evidenced by the breadth of today's announcements, that Sue has quickly formulated and executed important changes to customer-facing strategy, operations, management team, cost structure and liquidity. On behalf of the entire Board, we are very pleased and confident that Sue's dedicated leadership will continue to have a significant, positive impact on Company performance. Regarding our search for the Company's next Chief Executive Officer, the Company's Board of Directors previously announced that it retained nationally recognized firm, Russell Reynolds. We are in the earliest phase of the search process and will provide an update when appropriate."

Financial Update (Interim)
At this time, the Company is providing the following interim financial update for the second quarter of fiscal 2022 ended August 27, 2022:

– Net Sales of approximately $1.45 billion

– Comparable Sales decline of approximately 26% compared to the second quarter of fiscal 2021

– Free Cash Flow usage of approximately $325 million

Additionally, the Company is providing the following interim financial update for its fiscal 2022 expectations:

– Comparable Sales decline in the 20% range driven by improvements in the second half of fiscal 2022 versus the first half of fiscal 2022

– Adjusted SG&A expense approximately $250 million below last year reflecting cost optimization actions occurring in the second half of fiscal 2022

– Capital expenditures of approximately $250 million versus the Company's original plans of approximately $400 million

The Company has not yet completed its quarterly financial close and plans to provide its full financial results for the second quarter on Thursday, September 29, 2022. Until that time, the preliminary results described in this press release are estimates only and remain subject to change and finalization based on management's ongoing review of results of the quarter and completion of all quarter-end close review process.

Conference Call and Investor Presentation
To discuss today's announcement, Bed Bath & Beyond Inc. will host a conference call with analysts and investors today at 8:15am EDT and may be accessed by dialing 1-404-400-0571, or if international, 1-866-374-5140, using conference ID number 58295059#. A live audio webcast of the conference call will also be available on the investor relations section of the Company's website at http://bedbathandbeyond.gcs-web.com/investor-relations. The webcast will be available for replay after the call.

The Company has also made available an Investor Presentation on the investor relations section of the Company's website at http://bedbathandbeyond.gcs-web.com/events-and-presentations.

About the Company
Bed Bath & Beyond Inc. and subsidiaries (the "Company") is an omnichannel retailer that makes it easy for our customers to feel at home. The Company sells a wide assortment of merchandise in the Home, Baby, Beauty and Wellness markets. Additionally, the Company is a partner in a joint venture which operates retail stores in Mexico under the name Bed Bath & Beyond.

The Company operates websites at bedbathandbeyond.com, bedbathandbeyond.ca, buybuybaby.com, buybuybaby.ca, and facevalues.com.

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Bed Bath & Beyond stock still 'considerably overvalued' despite selloff after strategic update

Published: Aug. 31, 2022 at 11:59 a.m. ET
By Tomi Kilgore

https://www.marketwatch.com/story/bed-bath-beyond-stock-still-considerably-overvalued-despite-selloff-after-strategic-update-2022-08-31?siteid=yhoof2

Shares of Bed Bath & Beyond Inc. BBBY, -21.35% tumbled 20.3% in morning trading after the struggling home goods retailer's strategic update, but Wells Fargo analyst Zachary Fadem believes it should fall a lot more before he considers recommending it to investors. "Following yet another strategic change at BBBY, we can't help but fell like we've seen this movie before -- and it didn't end will," Fadem wrote in a note to clients. He reiterated his underweight rating and stock price target of $3, which implies TKT downside from current levels. He said the details the company provided around near-term operations, such as margins, inventory, cash trajectory, etc., were "too slim" for him to get more constructive on the company's outlook. "All in, we struggle to find a bull case in this; and while we believe BBBY's restructuring efforts and pivot away from owned brands likely makes sense, we see few reasons to believe [same-store sales]/margins can structurally improve from here; and thus, we view shares considerably overvalued at these levels," Fadem wrote. The stock has dropped 65.0% over the past 12 months, while the S&P 500 SPX, 0.05% has lost 11.7%

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BBBY turn around plan

https://www.sec.gov/Archives/edgar/data/886158/000119312522234603/d279013dex992.htm

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What's getting missed as Bed Bath & Beyond unravels: Morning Brief
Brian Sozzi

https://finance.yahoo.com/news/bed-bath-beyond-unravels-morning-brief-092200037.html

Brian Sozzi·Anchor, Editor-at-Large
Tue, September 6, 2022 at 3:22 AM·6 min read


I spent Labor Day weekend reflecting deeply on how I wanted to approach reporting on the suicide of Bed Bath & Beyond CFO Gustavo Arnal. I didn't really discover a comfortable answer.

I've been critical of how Bed Bath & Beyond has been run and blunt about what lays ahead for the home goods retailer. That comes with the territory of being a journalist since it's what we signed up to do: hold truth to power.

At the same time, a family man took their own life and that must be handled by a journalist with great care. I'd argue that a few outfits aren't doing that, instead playing up Arnal's stock sales in August and the fact he signed off on 150 store closures last week. That approach is a shame.

So what I have for you essentially boils down into two parts.

First, the human component.

Arnal, 52, fell to his death from the New York City skyscraper known as the "Jenga" tower on Friday afternoon. Reports say he jumped from the 18th floor. Myself and others just had listened to Arnal on a conference call Wednesday where Bed Bath & Beyond outlined its near-term turnaround strategy.

Arnal was an early hire of former Bed Bath & Beyond CEO Mark Tritton in 2020, having risen the executive ranks in finance capacities at P&G, Walgreens, and Avon. Arnal's LinkedIn page was deleted on Monday.

Suffice it to say, landing the CFO job at Bed Bath & Beyond was the highest-ranking position in his career. If he were able to save Bed Bath & Beyond, it would have likely put him on a CEO track.

People that knew Arnal tell me he was a family man through and through, as well as a great teammate and leader. What he did on Friday was incredibly out of character, these people said.

"Our memory of Gustavo is of a great professional and a happy family man, very devoted to his lovely family," one former colleague at P&G told me. He was a very smart 'work hard play hard' man, always ready to share his energy and smiles with the people around him, both in the office and outside."

Another former coworker at P&G echoed that sentiment to me via email.

"He was a really good guy, well-liked, straight 'up-the-middle' kind of guy," the person said. "Always had a smile."

Someone who worked with Arnal at Bed Bath & Beyond told me they were "shocked" at the news and that it made "no sense."

Bed Bath & Beyond communications chief Julie Strider didn't return my request for comment. The company put out a statement saying they are "profoundly saddened by this shocking loss."

Having talked to these people and others, what happened does seem out of character for Arnal. I think Bed Bath & Beyond interim CEO Sue Gove keeping Arnal on as CFO after Tritton was ousted and allowing him to present to investors last Wednesday says a lot on how he was viewed internally by the executive team, board, and his own finance team.

But as one former CEO told me while discussing this tragedy, C-suite jobs are high pressure and full of loneliness. And to that end, you just never know what a person is dealing with inside.

Indeed, Arnal's recent job was a full on pressure cooker: He had to deal with a struggling retailer burning through cash, wild swings in the stock price in this meme trader driven backdrop, vile threads on social media, and the actions of influential shareholder Ryan Cohen.

Arnal dealt with stressful high-profile executive positions for decades, which adds up and takes a toll physically, mentally, and emotionally— however tough and smiley one appears to be on the outside.

We don't know what's going on in a person's mind and heart. It's especially hard for us on the outside to figure out executives at public companies, as they tend to play by the book. But as an investor, you have to remember these are the imperfect humans running companies that you have invested in. No one is a perfect executive. Mistakes will be made because companies aren't run by robots (at least not yet).

Aside from the tragedy, I would be remiss if I didn't bring up part two.

When companies unravel (usually after a period of bad financial performance), strange things often happen in sequence. I have seen it time and time again. A quarter is missed by 30 cents, the stock price crashes, analysts hammer the company and say the future looks bleak for whatever reason. Speculation surfaces on a need to raise cash on penalizing terms. Shareholder lawsuits pop up from investors who lost a ton of money. Execs are canned. Perhaps financial reports are delayed. And so on.

All of this has begun to happen at Bed Bath & Beyond.

A pre-earnings investor call to outline a turnaround strategy, as seen last week, isn't normal. Having three people stuffed on a board because Cohen — who founded the pet services company Chewy and is currently GameStop's chairman — buys a bunch of shares and writes a shareholder letter isn't normal. Same-store sales tanking 26% in a quarter isn't normal. Potentially selling 12 million shares to raise cash isn't normal, especially for an established company like Bed Bath & Beyond. A shareholder lawsuit like the one filed on August 23 against Arnal, Cohen, and JP Morgan that alleged a "pump and dump" scheme isn't normal. (Bed Bath & Beyond described the allegations as "without merit," and a representative for Cohen didn't return a request for comment.)

All of these are symptoms of an unraveling company, and I would expect more abnormal things to surface in the days, weeks, and months ahead. Investors have to be incredibly careful when putting money into distressed situations such as Bed Bath & Beyond because there is usually a turn in the story you couldn't see coming. Sometimes those turns are tragic.

My thoughts are with Arnal's family and friends.

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Bed Bath & Beyond set to report second-quarter earnings before Thursday's open
Wed, September 28, 2022 at 3:06 PM

https://finance.yahoo.com/video/bed-bath-beyond-set-report-210654954.html

Struggling retailer Bed Bath & Beyond will report its second-quarter earnings on Thursday morning.

Video Transcript
DAVE BRIGGS: My now stock to watch tomorrow, Bed, Bath & Beyond. The struggling retailer reporting second quarter earnings ahead of the open. And investors are looking for any progress on the company's turnaround plans. Bed, Bath is expected to post a loss of $1.58 per share on revenue of $1.45 billion. Last month, it reported net sales that missed analyst estimates. Same store sales are expected to decline 25% from a year ago.

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BBBY

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BBBY cpps $3.885 on 12.9M Above Avg. volume 9:03 MT

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Huh? .... Bed Bath & Beyond Stock Falls After Disclosing Letter From the SEC
By Sabrina EscobarFollow
Dec. 30, 2022 10:31 am ET

https://www.barrons.com/articles/bed-bath-beyond-stock-falls-after-disclosing-letter-from-the-sec-51672414268?siteid=yhoof2

Bed Bath & Beyond BBBY –5.16% stock fell on Friday after the company disclosed it had received a letter from the Securities and Exchange Commission requesting further information about its annual report for fiscal 2021.

(WTF?)

Bed Bath & Beyond (ticker: BBBY ) filed its annual report of operations for 2021, also called a form 10-K, in February. In a letter dated Sept. 27 and released Friday , SEC officials requested further details on how supply chain disruptions impacted Bed Bath’s operations in the second half of the fiscal year, and whether the company had undertaken any risk mitigation strategies.

In response to the query, the company reiterated its estimate that net sales had dipped by $275 million because of inventory issues associated with supply chain challenges and delays, and that gross margins had contracted between 3 and 4 percentage points in the fourth quarter thanks to higher freight costs. The company hasn’t implemented any mitigation efforts, management said, given that it is in the midst of switching up its import strategy to source a greater share of its Owned Brands from domestic suppliers.

“As a result, the company does not believe at this time that there is any material direct long-term impacts of the fiscal 2021 supply chain disruptions and thus no significant mitigation efforts have been undertaken,” wrote Laura Crossen, interim CFO, in a letter dated Nov. 7 and released Friday.

Im confused. They filed those

Instead, the company has added several new risk factors addressing supply chain disruption to its quarterly filings, starting in the second quarter of 2022, released at the end of September this year.

Bed Bath will also be including information on its key operating metrics more uniformly across its quarterly and annual filings, in response to the SEC’s request that the supplemental information provided in news releases be present in filings to the regulatory agency as well. This includes dollar and basis point impacts to gross margin, supplemental comparable revenue information, and other impacts to selling, general, and administrative expenses.

The company didn’t immediately respond to Barron’s request for comment.

Shares of Bed Bath fell 4.2% to $2.42 on Friday, faring worse than the S&P 500’s 0.9% decline. The stock has shed 83% of its value this year, battered by a series of unfortunate events—from subpar quarterly performance to the death of CFO Gustavo Arnal and a distressed debt exchange that has opened up the possibility of default in the eyes of credit credit-rating firms.

[eastunder]

Possible BK play... BBBY

Bed Bath & Beyond warns it may go out of business, stock tanks
Brian Sozzi and Myles Udland

Thu, January 5, 2023 at 7:03 AM MST·2 min read

https://finance.yahoo.com/news/bed-bath-beyond-warns-it-may-go-out-of-business-stock-tanks-140329789.html

The end may be near for Bed Bath & Beyond (BBBY).

In a statement published before the market open on Thursday, the company said bankruptcy is on the table as it works to shore up its leaky balance sheet amid continued financial struggles.

Stay ahead of the market
"The Company continues to consider all strategic alternatives including restructuring or refinancing its debt, seeking additional debt or equity capital, reducing or delaying the Company's business activities and strategic initiatives, or selling assets, other strategic transactions and/or other measures, including obtaining relief under the U.S. Bankruptcy Code," Bed Bath & Beyond said in a statement.

"These measures may not be successful," the statement added.

Bed Bath & Beyond shares were down 20% in pre-market trading. The stock is trading at levels not seen since 1993.

For its fiscal third quarter ending November 26, 2022, sales dropped over 30%, to $1.259 billion from to $1.878 billion in the same quarter last year. The company said those numbers reflected "lower customer traffic and reduced levels of inventory availability, among other factors."

Bed Bath & Beyond expects to report a net loss of $385.8 million for the quarter.

Notably, this period for the company does not include the bulk of the key holiday shopping season, which some analysts have said will likely be the last for the struggling retailer.

"While the Company continues to pursue actions and steps to improve its cash position and mitigate any potential liquidity shortfall, based on recurring losses and negative cash flow from operations for the nine months ended November 26, 2022, as well as current cash and liquidity projections, the Company has concluded that there is substantial doubt about the Company's ability to continue as a going concern," Bed Bath & Beyond said.

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What’s ahead for Bed Bath & Beyond in wake of bankruptcy warning

https://www.cnbc.com/2023/01/09/bed-bath-beyond-bbby-whats-ahead-in-wake-of-bankruptcy-warning.html

RETAIL
PUBLISHED MON, JAN 9 202311:38 AM ESTUPDATED 12 MIN AGO

KEY POINTS

Bed Bath & Beyond reports its quarterly earnings on Tuesday before the bell.

The struggling home goods retailer recently warned it may have to file for bankruptcy.

The company’s turnaround plan called for cost-cutting and improved partnerships with vendors. But its sales have yet to improve.

When Bed Bath & Beyond leaders speak to investors Tuesday morning, they won’t simply report sales and earnings results. They will have to address a stark reality: The cash-strapped home goods retailer is running out of time.

On Thursday, Bed Bath warned it may have to file for bankruptcy, saying it could soon be unable to cover costs as sales lag and store traffic dwindles. It also said it’s struggling to keep items in stock, as it runs low on cash and works to remedy strained relationships with suppliers.

The nationwide chain, known for its 20% coupons and sky-high piles of towels and housewares, is increasingly at risk of joining the list of retailers that have shuttered stores and faded away. Think, Sears. Circuit City. RadioShack. Pier 1. Linens ’n Things.

What’s more, the attempted turnaround comes at the same time that inflation weighs on consumers’ wallets and as the housing market gets hit by higher interest rates. Plus, after spending the earlier years of the Covid pandemic at home, more people are choosing to spend money on dining out or booking trips rather than buying cookware, a duvet or throw pillows.

“When you have a shift in how consumers are allocating their spending, and a recession looming potentially on the horizon, it makes it much more of an uphill battle,” said Justin Kleber, senior research analyst at Baird Equity Research.

The company’s stock performance reflects its tough path forward, too. Shares of the company touched a 52-week low on Friday. As of Monday’s close, they were trading around $1.62 for a market value of less than $150 million.

Chasing a comeback
Bed Bath laid out its latest turnaround strategy in August. The plan called for drastic cost cuts in the way of closing about 150 of its namesake stores and reducing its head count by about 20% across its corporate and supply chain workforce.

Those efforts have brought its operating costs down, as it tries to drive up sales: For the third quarter, Bed Bath expects operating expenses to be about $583.6 million, compared with about $698 million in the year-ago period, it said Thursday.

The company’s turnaround strategy also involved phasing out some of its private labels and bringing back more well-recognized national brands. It pledged in August to work with those national brands to develop exclusive items and to add items from direct-to-consumer brands — merchandise aimed at setting it apart and giving shoppers a reason to come back to its stores.

Come Tuesday, investors will want to hear if the company has improved its inventory levels, if they managed to secure any exclusive items for the holiday season and how willing vendors have been to work with the retailer. If Bed Bath has made significant inroads in improving inventory, it could offer a glimmer of hope for the quarters ahead.

“Being the first to bring new brands and products to our customer has always been one of our roles as a retailer,” Executive Vice President Mara Sirhal told investors during an Aug. 31 business update. “In the home market, there’re many D2C brands which bring their own compelling brand marketing and followers who know and want them but aren’t widely available to shop.”

Emerging direct-to-consumer brands have an incentive to partner with brick-and-mortar shops like Bed Bath and Target, as they offer a way to reach more customers and a reprieve from the e-commerce cooldown, steep marketing costs and consumer habit shifts that have cut into profitability since the pandemic began to wane.

But brands and vendors have been hesitant to extend credit to Bed Bath as its mounting debt cast doubt over its ability to pay back bills.

And sales trends overall have remained weak.


The company said Thursday it expects net sales for the fiscal third quarter, which ended Nov. 26, to be about $1.26 billion — a nearly 33% drop from the $1.88 billion it reported for the year-ago period. Bed Bath anticipates a net loss of about $385.8 million for the quarter, an approximately 40% jump in losses year over year. Those quarterly losses include an approximately $100 million impairment charge, which was not specified.

CEO Sue Gove urged patience on Thursday, saying the turnaround will take time. She took the helm after former CEO Mark Tritton was pushed out in June.

“Transforming an organization of our size and scale requires time, and we anticipate that each coming quarter will build on our progress,” she said in a news release.

Baird’s Kleber said investors will want to hear if there’s been a change in sales trends during the Christmas season — key weeks that would be reflected in fourth-quarter results, but could be previewed sooner.

‘Kiss of death’?
Before Bed Bath can address moving product off shelves, though, it needs to tackle an even more fundamental problem: having enough merchandise to fill them.

Gove said low inventory was partially to blame for the company’s anticipated third-quarter losses.


Bed Bath is using dollars it earned during the holiday season to bulk up the shelves with help from its key vendors, Gove said. As in-stock levels have improved, so have sales trends, she said.

But it’s not clear if that will be enough.

“At the end of the day, all of the yabba dabba doo about their newly minted strategy that they were touting over the last six months. It’s all just a lot of talk,” said Mark Cohen, a professor and director of retail studies at Columbia Business School.

Cohen said he sees the going-concern warning as the “kiss of death” for Bed Bath, solidifying bankruptcy as the retailer’s only remaining option — beyond a savior swooping in with an infusion of cash or to buy a stake of the company.

“Without a defining event of that sort, this company is toast,” said Cohen, former CEO of Sears Canada.

[eastunder]

Bed Bath & Beyond Has Nothing But Itself to Blame for Impending Bankruptcy

https://finance.yahoo.com/news/bed-bath-beyond-nothing-itself-140004464.html?

Jeannette Neumann and Eliza Ronalds-Hannon
Mon, February 6, 2023 at 7:00 AM MST·9 min read

(Bloomberg) -- Bed Bath & Beyond Inc., facing a crisis in late summer as sales plunged and suppliers revolted, insisted its white-collar workers return to the office four days a week.

Interim Chief Executive Officer Sue Gove told staff at company headquarters in Union, New Jersey, that face time would help quickly address mounting problems facing the retailer, according to six former managers and employees who attended the gathering.

To the employees, however, it felt like just another example of how executives were mired in minutiae as the chain barreled toward bankruptcy. Most staffers had already returned to the office three days a week. One employee spoke up and said an extra day wouldn’t turnaround the struggling company. Many in the room nodded or applauded, according to the former managers and employees.

When other well-known stores spiraled into distress in recent years, the internet often took the blame. But the case of Bed Bath & Beyond is more complicated. While the chain was hurt by online rivals like Amazon.com Inc., its undoing is also a story of how deciding to rip it up and start again can leave a company in tatters.

Layoffs, management changes, boardroom shake-ups, stock buybacks and strategic overhauls are go-to maneuvers for modern business, and Bed Bath & Beyond tried them all. At nearly every recent turn, the company took steps that led it deeper into a financial quagmire.

Weeks after the return-to-office edict, Gove said the company would fire about a fifth of its corporate and supply-chain workforce and shut 150 of its nearly 770 Bed Bath & Beyond brand stores in the US. The retailer had secured new financing, Gove said, and was launching a turnaround plan to prepare for the holiday-shopping season.

The reprieve didn’t last. Bed Bath & Beyond has indicated it is preparing for a potential bankruptcy filing. It has missed payments to banks and bondholders, and former employees say they haven’t been paid severance. If the company restructures in bankruptcy by closing more stores, it could emerge as a smaller version of its former self. However, Bed Bath & Beyond’s financial situation is so dire it’s also possible the retailer sells its assets and ceases to operate, Bloomberg News has previously reported.

A Bed Bath & Beyond spokeswoman didn’t respond to requests for comment on this article.

At its peak in 2017, Bed Bath & Beyond had 1,560 stores with 65,000 employees, bringing in $12.3 billion in revenue. But in the nine months through November 2022, it posted sales of just $4.2 billion, and its headcount dwindled to fewer than 30,000.

Blind Spot

Warren Eisenberg and Leonard Feinstein founded Bed Bath & Beyond in 1971. As it grew, the company shunned retail orthodoxy, giving managers wide discretion in stocking shelves, rather than relying on mandates from headquarters. It mostly eschewed warehouses, stacking can openers, coffee pots and bathmats nearly to the ceiling in its stores.

“Everything that we did was for the customer,” Arthur Stark, Bed Bath & Beyond’s longtime president, who left in 2018, said in an interview. “If it meant carrying too much inventory in the store, it was OK. If customers made the commitment to come to our store, we would have it in stock.”

Bed Bath & Beyond also pleased shareholders. Under longtime CEO Steve Temares, it poured billions into repurchasing stock, and acquired Christmas Tree Shops, Cost Plus World Market and Buybuy Baby, founded by Feinstein’s sons.

Still, the company's executives had a blind spot: the web. As Amazon.com and other online shopping sites appeared on the horizon, Bed Bath & Beyond’s executives prioritized their brick-and-mortar business. Eventually, that caught up with them.

Same-store sales, a closely watched retail metric that excludes new or recently closed stores, began to fall in 2017. Stark, who joined Bed Bath & Beyond in 1977, said that in hindsight, the company should have focused more on online retail.

“Surely we could have done better,” he said. “There’s no question.”

According to Stark, the company’s success made it reluctant to change. It had been profitable for years and seemed to go from strength to strength, expanding across the US and Canada.

“We were confronting the challenge of maintaining our stores, maintaining our profitability and investing in technology and digital,” he said in the interview. Stark, 67, now serves on the senior advisory boards for Jefferies Group and Vintage Investment Partners.

Bed Bath & Beyond should have considered going private, Stark said, to invest in e-commerce at the temporary expense of profits. Management had entertained suggestions to take the company private during his tenure, he said.

As executives struggled to invest for the long term amid short-term market pressures, one of the best-known discounts in US retail history was adding to the strain. Bed Bath & Beyond’s 20%-off coupons, sent to tens of millions of households for years, lured shoppers and boosted sales. But they eroded profits, too.

“Like any form of promotion, it becomes a drug,” Stark said. Over the years, attempts to pull back on the mailings or reduce the discount backfired. “Once you’re addicted to it and your customer is addicted to it, it’s a very difficult thing to wean them off of.”

Activist Investors

By early 2019, activist investors began agitating for change. Ancora Advisors, Macellum Capital Management and Legion Partners Asset Management wanted Temares to leave. The trio urged asset sales, more investment in private-label brands and online commerce, and more buybacks.

In a 168-page document making their case, the investors noted that the first time Bed Bath & Beyond executives said the word “Amazon” on a conference call was Dec. 21, 2016, a sign they weren’t “embracing industry change.”

Within months, Temares was out.

“We always were well aware of our competitors, respected them, and studied what they did to learn what we could do better,” Temares wrote in a statement in response to questions from Bloomberg.

“I could not have been more proud of the associates I worked with, the quality people they are, and the dedication they exhibited,” he added. “That was then. Ultimately, as we see over and over again, arrogance and ineptitude are deadly.”

The board, with four new members selected as part of an accord with the activists, named former Target executive Mark Tritton CEO in October 2019. As Target’s chief merchandising officer, Tritton had overseen a private-label overhaul credited with helping speed up growth at the discount giant.

Tritton and his team, which included former senior executives from TrueValue, Walgreens and Macy’s, moved fast to tackle the falling profitability and revenue they inherited. They wanted a third of Bed Bath & Beyond products to be private-label, up from 10%, within three years.

Tritton also said he planned to get rid of poorly performing labels and double down on well-known brands such as KitchenAid and Oxo. But that effort faltered as major brands faced pandemic-supply chain problems and the company’s worsening cash crunch left it unable to pay for premium products, according to former managers.

Even before Bed Bath & Beyond’s finances took a nosedive, Tritton and his team showcased their new private-label goods in the redesigned stores and downplayed national brands, according to some of the former managers and employees.

In a presentation to investors a year after taking the reins, Tritton compared his revamp to remodeling a home. “Our house is beloved by so many, but a house reliant on positive memories from the past won’t weather any storm,” he said.

Share Buybacks

In the first five months of 2021, Tritton pushed to introduce six new private-label product lines — ambitious by retail standards. The degree of difficulty was increased by attempting to design, order and oversee manufacturing of thousands of new items as the pandemic snarled output and shipments from China. Once the private-label brands arrived in stores, most were new to shoppers and didn’t resonate with them.

Tritton also promised to use more cash buying back stock. In October 2020, he and his team pledged to repurchase $675 million in shares over three years. By November 2021, the amount had increased and the timeframe had accelerated: They would complete the repurchase of $1 billion shares within about one year. At the time, the retailer had around $600 million of cash on hand.

Some analysts thought that was aggressive. Executives appeared overly optimistic that strong spending by cooped-up consumers in 2020 and 2021 would endure. Dennis Cantalupo, CEO of Pulse Ratings, a credit-rating and consulting firm, said the company could have survived at least another six months if it hadn’t repurchased shares.

“Rather than take that money and put it in the bank and assume that the tailwinds to the industry are going to subside or normalize, they initiated the buyback campaign,” Cantalupo said.

The timing and magnitude of the buybacks stood out “given the simultaneous rapid decline in the company’s topline and cash flow and the need for the company to reinvest in its business quickly,” Fitch Ratings analysts David Silverman and Monica Aggarwal wrote in an email.

Tritton’s private-label push ended up outstripping the aims of some of the activist shareholders, according to people familiar with their thinking.

Some former Bed Bath & Beyond executives, though, say the pandemic and supply-chain problems made it nearly impossible for Tritton to transform the ailing company.

In March 2022, Tritton and his team welcomed employees back to the company’s renovated headquarters for the first time since the start of the pandemic. The theme was “Together, Happier,” a nod to a marketing campaign launched in 2021, called “Home, Happier.”

As part of the return, employees took part in activities including a scavenger hunt. One of the clues led to a new mural of Bed Bath & Beyond’s history entitled “Our Big Moments (So Far),” according to a photo viewed by Bloomberg News. The chronology included its founding, its 1992 public listing and its 2007 purchase of Buybuy Baby.

While the timeline mentioned Tritton’s appointment in 2019, it didn’t include the names of the founders or his predecessor. That felt fitting to several of the former managers and employees, who said it reflected a disregard for the company’s history and what had made it unique.

The retailer atrophied as the year went on. Tritton was ousted in June. Sales in the three months ended Aug. 27 fell 28% from the previous year. Inventories became increasingly sparse as many suppliers, worried about getting paid, halted or restricted shipments.

That’s meant many shoppers have left stores empty-handed, including the former Bed Bath & Beyond president, Stark.

About a year ago, he said, he went to a store in East Hanover, New Jersey, to shop for wedding registry gifts with his son and the son’s fiancée. The couple wanted Wamsutta bed sheets, once a staple at the retailer. They had no luck.

“They said, ‘Let’s go to Bloomingdale’s,’” Stark said.

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Bed Bath & Beyond’s Tanking Stock Puts Hedge Fund Rescue at Risk

Eliza Ronalds-Hannon
Fri, March 3, 2023

https://finance.yahoo.com/news/bed-bath-beyond-tanking-stock-144500206.html

(Bloomberg) -- The financial lifeline that pulled Bed Bath & Beyond Inc. from the brink of bankruptcy last month is already at risk because of the retailer’s tumbling stock price.

The equity financing, led by hedge fund Hudson Bay Capital, provided the company with $225 million upfront, with the promise of another $800 million over the coming eight months. Bed Bath & Beyond Chief Executive Officer Sue Gove on Feb. 7 trumpeted it as a “transformative transaction” that would give the company time to mount a turnaround.

Yet the additional cash has strings attached. Among them: Future injections are contingent on Bed Bath & Beyond maintaining a weighted average stock price of at least $1.25 or $1.50, depending on the timing, according to a regulatory filing. The deal terms allow Hudson Bay to waive those conditions if it wants.

But keeping the stock price above those thresholds may not be easy. It has already tumbled over 70% since Feb. 6 and closed as low as $1.41 on Tuesday. The shares ended Thursday at $1.56.

A representative for Hudson Bay declined to comment. A representative for Bed Bath & Beyond did not respond to requests for comment.

The pressure on the stock has stemmed in part from the rescue itself. The first leg gave Hudson Bay the right to convert its initial investment into common shares at a discount to the trading price, extending it the option to earn a quick profit by selling the shares.

Investors were quick to recognize the risk that the financing would flood the market with stock, diminishing the value of the outstanding shares. As a result, the price tumbled steadily after the deal was announced.

February’s deal wasn’t the first time Bed Bath & Beyond raised rescue financing in order to avert bankruptcy.

In August, the company pledged its assets to credit fund Sixth Street Partners in order to obtain a $375 million loan. The retailer had a net loss of $393 million in the three months ended in late November. By January, that money was gone, and Bed Bath & Beyond had entered into bankruptcy talks.

This time around, Sixth Street provided a fresh $100 million in connection with Hudson Bay’s equity deal. But given the scale of its quarterly losses, Bed Bath & Beyond’s future may be dependent on the promise of the $800 million to come — potentially putting the company’s fate at the mercy of its stock price.

--With assistance from Bailey Lipschultz and Jeannette Neumann.

[eastunder]

Bed Bath & Beyond Stock Is On Sale

https://news.bloomberglaw.com/banking-law/matt-levines-money-stuff-bed-bath-beyond-stock-is-on-sale

Hudson Bay Capital Management would put about $1 billion into Bed Bath in exchange for vast amounts of stock. But not, like, Hudson Bay wrote a check for $1 billion and Bed Bath gave it a pile of stock. Rather, the deal is that Bed Bath got $225 million, and in exchange it would basically give Hudson Bay stock each day, and Hudson Bay would sell it, until Hudson Bay got back its $225 million plus a nice little return. The mechanics were more complicated than that — they involve convertible preferred stock with a floating conversion rate, etc. — but that’s the economic intuition. Each day Hudson Bay can convert some of its $225 million investment into shares at below the market price that day, and then sell those shares to pay itself back with interest.

If all goes well, Hudson Bay will put up more money: as much as $800 million more, in stages, over the course of the year. Each time, it will put up some money and get the same deal again, convertible preferred stock that it can convert over time into common shares at a discount to the market price each day. It keeps doing that until Bed Bath has gotten the full billion.

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Bed Bath & Beyond Inc. Enters into Committed Equity Facility for Additional Funding

Builds on Recent Launch of New At-the-Market Offering

Terminates Previously Issued Warrants for Series A Convertible Preferred Stock

Provides Business Update

https://www.sec.gov/Archives/edgar/data/886158/000119312523084725/d477204dex992.htm

UNION, N.J., March 30, 2023 — Bed Bath & Beyond Inc. (Nasdaq: BBBY) (the “Company”) announced today that concurrent with a new, At-The-Market offering program (“ATM Program”) launched earlier today, the Company has also entered into a common stock purchase agreement and a registration rights agreement (collectively, “Committed Equity Facility”) with B. Riley Principal Capital II, LLC to provide additional capital to the Company. Simultaneously, the Company is terminating its previous public equity offering and all outstanding warrants for Series A Convertible Preferred Stock associated with that offering. The Company intends to file a registration statement on Form S-1 with respect to the Committed Equity Facility, upon the effectiveness of which the Company would be permitted to begin selling additional securities pursuant to its terms.

The potential net proceeds from these financing transactions will be used immediately to fulfill conditions set forth in an amendment to the Company’s credit facility filed earlier today. The Company expects to utilize its amended credit facility to enable its strategic initiatives in fiscal 2023, such as investing in merchandise inventory, which will be further supported by a realigned store footprint and cost structure.

Sue Gove, President & CEO of Bed Bath & Beyond Inc. said, “The actions we’ve taken have enabled us to create the necessary financial runway to begin restoring our iconic Bed Bath & Beyond and buybuy BABY businesses. We have raised $360 million of equity capital since the beginning of February, cured our default under our credit agreement, repaid material amounts of our ABL facility, completed our interest payment for our Senior Notes, all while jumpstarting our turnaround plans.”

Ms. Gove continued, “The customer experience remains our top priority and we are making meaningful progress to improve our business and calibrate to customer demand. In addition to leveraging our recent capital to reinvest in high demand inventory, we are also developing a third-party consignment program that will allow us to fortify our product assortments by expanding merchandise availability from key supplier partners. We are on pace to achieve our target of 360 top-performing Bed Bath & Beyond stores by the end of April, in addition to our existing 120 buybuy BABY stores. In conjunction with our online business, these productive stores are pivotal to our omni-channel strategy and future profitability.”

Ms. Gove concluded, “As demonstrated by our plans for additional equity capital, our work remains focused on creating operational and financial avenues for further progress. We believe today’s launch of the ATM Program will expand the reach of our equity program, and accelerate the return of our nationally recognized Bed Bath & Beyond and buybuy BABY brands back to prominence.”

As of March 27, 2023, the Company had a total of approximately 435 million shares of common stock issued, and approximately 295 million shares of common stock available for issuance.

In conjunction with today’s business update, the Company is providing the following preliminary financial results for the fiscal 2022 fourth quarter (ended February 25, 2023):


Net Sales of approximately $1.2 billion

Comparable Sales decline in the 40% to 50% range1

Continuation of negative operating losses

Modest free cash flow usage

The Company has not yet completed its fiscal year 2022 fourth quarter and full year financial close and plans to provide its full financial results for the fiscal 2022 fourth quarter and full year at the end of April 2023. Until that time, the preliminary results described in this press release are estimates only and remain subject to change and finalization.

[eastunder]

BBBY

Special Meeting of Shareholders on May 9, 2023 - Reverse imminent unless they file BK first... or the Monkeys pull off another save.

Good volume today

cpps $0.3239 + $0.0278(+9.39%)

Today's Volume
103.7M (Above Avg.) 8:50 MT


Averages Table
10-Day Average Volume 101,245,976

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BBBY S1 filed

https://www.sec.gov/ix?doc=/Archives/edgar/data/886158/000119312523097982/d496549ds1.htm

the Fourth Amendment sets forth: (i) the requirement to receive minimum specified equity proceeds (as defined in the Fourth Amendment) or to demonstrate the minimum cumulative specified equity proceeds (as defined in the Fourth Amendment). These testing periods are weekly for the next 8 out of 11 weeks requiring a minimum raise with an aggregate cumulative equity raise requirement of approximately $232 million by June 27, 2023 and then $12.5 million weekly thereafter subject to exceptions.

As of the date hereof, the conditions detailed above have been met as of the date required. The Company, however, may not be able to meet the conditions on future dates. The failure to meet these conditions would likely cause the Company to file for bankruptcy.

On March 30, 2023, the Company entered into a Sale Agreement (the “ATM Agreement”) with B. Riley Securities, Inc. (“B. Riley Securities”), as a sales agent, to offer and sell additional shares (“ATM Shares”) of common stock having an aggregate sales price of up to $300 million (the “ATM Program Amount”) from time to time through the Company’s “at the market offering” program. The ATM Agreement only provides for sales made pursuant to an effective registration statement on Form S-3. 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 ATM Agreement will cease by April 26, 2023. As of April 10, 2023, the Company has sold approximately 100.1 million shares for approximately $48.5 million of net proceeds under the ATM Agreement.[/b] The net proceeds have been used to satisfy conditions pursuant to the Amended Credit Agreement for the testing period ending April 11, 2023.

THEY HAD BETTER KICK UP THE PACE. TIME IS TICKING!

Nasdaq Global Select Market symbol

“BBBY”


(1) The
number of shares of common stock outstanding is based on 558,735,983 shares of common stock as of April 10, 2023 and excludes the following, in each case as of April 10, 2023, except as otherwise noted:

18,320,144 shares of our common stock issuable and reserved for future issuance upon the exercise of outstanding options, warrants and rights under Bed Bath & Beyond Inc’s. 2012 Incentive Compensation Plan and the 2018 Incentive Compensation Plan;

122,355,810 shares of our common stock reserved for issuance upon the conversion of the Series A Convertible Preferred Stock, par value $0.01 per share and stated value of $10,000 per share (the “Series A Convertible Preferred Stock”), and exercise of the warrants to purchase shares of our common stock (the “Common Stock Warrants”) issued pursuant to an underwritten public offering consummated on February 7, 2023;

5,000,000 shares of our common stock reserved for issuance pursuant to an exchange agreement (the “Exchange Agreement”) entered into by the Company with a holder on March 30, 2023 relating to the Series A Convertible Preferred Stock and Common Stock Warrants; and shares of our common stock reserved for issuance pursuant to the Commitment Shares.


In order to generate the Total Commitment under the Purchase Agreement, the market price of our common stock would need to increase significantly.

Even if the shareholders approved the Reverse Split Proposal and the Reverse Stock Split was effectuated, we would not have sufficient authorized capital to issue the Total Commitment under the Purchase Agreement unless the market price of our common stock increased significantly. Assuming a closing sales price of $0.31, which was the closing sales price of our common stock on the Nasdaq on April 6, 2023, we would be required to issue a total of approximately 2.8 billion shares of common stock in order to receive the Total Commitment under the Purchase Agreement. Following shareholder approval of the Reverse Split Proposal, if the Board were to adopt a maximum of 1-for-20 final ratio, the 473,094,776 shares of common stock issued (including treasury shares) as of April 3, 2023 prior to the Reverse Stock Split, will be reduced to approximately 23,654,739 issued shares of common stock (including treasury shares) post-Reverse Stock Split. In such a scenario, we would have 868,016,477 shares of common stock available for future issuance, which would be significantly less than the required amount of approximately 2.8 billion shares assuming a closing sales price of $0.31 on April 6, 2023. As such, unless the market price of our common stock increases significantly, we would not have sufficient authorized share capital to issue up to the Total Commitment under the Purchase Agreement even if the Reverse Stock Split was effectuated.

[eastunder]

BBBY +14% on Volume