Bed Bath & Beyond’s Shares Plummet On Q3 Earnings Miss

After Bed Bath & Beyond Inc. pulled its year forecast following its missed Q3 estimates, the home goods retailer’s stock fell to its lowest intraday level as of Nov. 25. Holiday sales reports that were disappointing from JCPenney and Kohl’s also put pressure on the company’s shares, Bloomberg reported.

Comparable sales fell short of estimates handily during the quarter, and Guggenheim’s Steven Forbes pointed out that EBIT margin became negative “for the first time in recent history.” Anthony Chukumba, a Loop Capital analyst, noted the report was “the worst we can remember since the Great Recession.”

Shares dropped as great as 19 percent to $13.53, which was under its 50-day moving average and the most intraday as of September 2018. The stock concluded last year with a gain of 53 percent following five consecutive years of declines.

But Wall Street might have been preparing for a pullback. The average analyst estimate on the day prior to the announcement of earnings was $15, which implied an approximate 10 percent downside from closing levels.

“Our performance in the third quarter was unsatisfactory and underscores the imperative for change and strengthens our sense of priorities and purpose,” Bed Bath & Beyond CEO Mark Tritton said in a statement, according to Fox Business. “We must respond to the challenges we face as a business, including pressured sales and profitability, and reconstruct a modern, durable model for long-term profitable growth.”

The news comes as a strong economy in the United States and healthy consumer spending wasn’t enough to bolster holiday sales at many department stores as well as mall-based retailers. JCPenney, Kohl’s and L Brands (Victoria’s Secret’s parent company) noted lower sales in November and December.

But not all traditional retailers are facing tough times. Walmart and Target have registered increasing sales as well as store traffic for much of the past year as they put effort into online ordering and in-store pickup services.