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Bed Bath shares sink on sales warning

Video credit: Reuters Studio
Published on February 12, 2020 - Duration: 01:15s

Bed Bath shares sink on sales warning

Shares of Bed Bath & Beyond plummeted in early trading Wednesday after the home furnishings retailer warned of a steep drop in sales.

Fred Katayama reports.

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Bed Bath shares sink on sales warning

Investors taking a bath on Bed Bath & Beyond, whose shares sank 26% in early trading Wednesday, after the home furnishing retailer warned that same-store sales for December and January dropped 5.4%... a much steeper fall than analysts had expected.

The company blamed falling store traffic and increased promotions for the decline.

It also said inventory was too low or out-of-stock in certain categories during the holiday shopping season.

Bed Bath's new CEO said the company is experiencing - in his words - "short-term pain," but its shares have been steadily falling over the long-term - plunging 80% since the end of 2014.

The company has been struggling to keep pace with changing consumer tastes and shopping habits over the years as it lost customers to Amazon, Walmart and Target.

It has cut jobs to cut costs.

And it recently sold real estate and leased it back so it could reinvest the proceeds toward transforming its core business and buy back stock.

At least five brokerages slashed their price targets on the beleaguered stock, which had already fallen 14% this year as of Tuesday's close.

The company is set to report its quarterly results in April.

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