Bed Bath & Beyond Inc. (NASDAQ: BBBY) stock plunged 12.21% on April 14th, 2021 and continued its bearish momentum falling over 2% on April 15th, 2021 (as of 12:22:03 UTC-4 · USD; Source: Google finance) after the company missed the topline estimates due to a double-digit decline in fiscal fourth-quarter sales, which were pressured by store closures and divestments from a bigger turnaround plan. The company’s net income during the period grew to $9.1 million compared to a loss of $65.4 million, a year earlier.
BBBY in the fourth quarter of FY 20 has reported the adjusted earnings per share of 40 cents, while reported 16 percent fall in the adjusted revenue to $2.62 billion in the fourth quarter of FY 20, missing the analysts’ estimates for revenue of $2.63 billion. The company said the year-over-year decline was partially driven by the sale of its Christmas Tree Shops and Cost Plus World Market businesses as well as ongoing store closures. Same-store sales grew 4%. Online sales surged 86% during the fourth quarter, but that wasn’t enough to fully offset the declines of in-store traffic. The company noted 41% of online sales were fulfilled by stores.
Bed Bath & Beyond reaffirmed its fiscal 2021 sales outlook, and continue to expect revenue to range between $8 billion and $8.2 billion. Analysts were projecting fiscal 2021 sales to be of $8.18 billion, according to Refinitiv.
The company is forecasting first-quarter net sales to increase by more than 40% year over year. The analysts had been projecting for a 45.8% jump. Excluding the impact from divested businesses, however, Bed Bath & Beyond said sales from its core banner stores could grow upwards in the range of 65% to 70%.
Meanwhile, BBBY is in the process of remodeling 130 to 150 stores this fiscal year. The company plans to remodel 26 stores in the first quarter alone. It just completed its first batch in the Houston market in February. The company said it will spend about $250 million over the next three years to remodel about 450 Bed Bath & Beyond shops in total.
Additionally, the company is also bolstering its roster of private labels across different home goods categories. It’s planning to launch at least eight brands this year, hoping the exclusivity will be enough to drive people to its stores.
In addition, the company plans to buy back $325 million of its own stock this year, up from $300 million last year.