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Bed Bath & Beyond (BBBY) Concludes $225M Share Repurchase Plan
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In sync with its strong shareholder values, Bed Bath & Beyond Inc. has completed its $225 million worth of accelerated share-repurchase program, which was announced on Oct 29, 2020.
Per the plan, the company bought back roughly 11 million shares of its common stock at an average price of $20.77. Moreover, it extended the end date of its second accelerated share-repurchase plan worth $150 million until April 2021 instead of February. Notably, the second buyback plan was initially announced on Jan 11.
Moreover, the $225-million accelerated share repurchase plan is part of the company’s up to $825-million accelerated share-repurchase authorization, which is valid for the next three years. This reflects an increase from $675 million stated earlier. Also, the move comes after management revealed plans to restart shareholder returns on its third-quarter fiscal 2020 earnings call. That said, Bed Bath & Beyond boasts liquidity of $2.2 billion, driven by a solid cash flow of $244 million as of Nov 28, 2020, which is likely to help it stay afloat amid the crisis.
Markedly, shares of this company have rallied 46.4% in the past three months compared with the industry’s growth of 13.9%.
What Else Do You Need to Know?
Given the ongoing pandemic, Bed Bath & Beyond remains poised to gain from its digital platform, which offers omni-channel services such as Buy-Online-Pick-Up-In-Store (BOPIS) and Curbside Pickup. This, in turn, is leading to customer acquisition.
Moreover, sales from its mobile app rose more than a two-fold year over year in third-quarter fiscal 2020. During the five-day holiday sale period from Thanksgiving to Cyber Monday, the company witnessed year-over-year double-digit growth in overall comps for the core U.S. Bed Bath & Beyond banner, with digital comps up roughly 69%.
For the fiscal fourth quarter, it anticipates positive sales momentum to continue in the digital platform. Encouragingly, the company introduced same-day delivery services on bedbathbeyond.com and buybuybaby.com during the said quarter. Also, it partnered with Shipt and Instacart to provide same-day delivery services to customers of Bed Bath & Beyond and buybuy BABY banners.
Apart from a solid online show, improved gross margin led to adjusted EBITDA growth, which, in turn, drove bottom-line growth in the fiscal third quarter. Notably, the company reported the second successive quarter of growth in profit. It expects adjusted EBITDA margin to be higher year over year in the fiscal fourth quarter on the back of a positive product mix, higher markdowns, better promotions as well as lower distribution and fulfillment costs. Also, fiscal 2020 adjusted EBITDA has been lifted to $500-$525 million, up from $500 million mentioned earlier.
Further, the company is on track with restructuring efforts to achieve improved profits over the next two-three years. Alongside this, the company expects SG&A savings of $85 million from the strategic actions announced in February 2020. Out of these cost savings, management intends to reinvest roughly $150-$200 million in future initiatives. Additionally, it anticipates realizing savings of nearly $150 million and $200 million, respectively, through cost-cutting actions and reduced discretionary costs as well as renegotiations with existing vendors.
As part of such streamlining efforts, the company divested many businesses, which is likely to generate annual SG&A savings of $85 million. This will then be reinvested in omni-channel transformation and to boost shareholder return. Further, the company’s store-network optimization project is likely to generate savings of nearly $100 million on an annual basis. Also, it noted that its non-core portfolio banner work is nearing completion in the fiscal fourth quarter and will position it well for a solid start to fiscal 2021.
However, COVID-related headwinds, including dismal store traffic, significant shipping constraints and increased freight expenses are anticipated to weigh on this Zacks Rank #4 (Sell) company’s top line in the fiscal fourth quarter. In fact, net sales are expected to decline at a double-digit rate, with in-store traffic likely to remain drab.
Tapestry (TPR - Free Report) , with a Zacks Rank #1, has an expected long-term earnings growth rate of 11.7%.
Capri Holdings Limited (CPRI - Free Report) presently has an expected long-term earnings growth rate of 5.6% and a Zacks Rank #2 (Buy).
Zacks Names “Single Best Pick to Double”
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
You know this company from its past glory days, but few would expect that it’s poised for a monster turnaround. Fresh from a successful repositioning and flush with A-list celeb endorsements, it could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in a little more than 9 months and Nvidia which boomed +175.9% in one year.
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Bed Bath & Beyond (BBBY) Concludes $225M Share Repurchase Plan
In sync with its strong shareholder values, Bed Bath & Beyond Inc. has completed its $225 million worth of accelerated share-repurchase program, which was announced on Oct 29, 2020.
Per the plan, the company bought back roughly 11 million shares of its common stock at an average price of $20.77. Moreover, it extended the end date of its second accelerated share-repurchase plan worth $150 million until April 2021 instead of February. Notably, the second buyback plan was initially announced on Jan 11.
Moreover, the $225-million accelerated share repurchase plan is part of the company’s up to $825-million accelerated share-repurchase authorization, which is valid for the next three years. This reflects an increase from $675 million stated earlier. Also, the move comes after management revealed plans to restart shareholder returns on its third-quarter fiscal 2020 earnings call. That said, Bed Bath & Beyond boasts liquidity of $2.2 billion, driven by a solid cash flow of $244 million as of Nov 28, 2020, which is likely to help it stay afloat amid the crisis.
Markedly, shares of this company have rallied 46.4% in the past three months compared with the industry’s growth of 13.9%.
What Else Do You Need to Know?
Given the ongoing pandemic, Bed Bath & Beyond remains poised to gain from its digital platform, which offers omni-channel services such as Buy-Online-Pick-Up-In-Store (BOPIS) and Curbside Pickup. This, in turn, is leading to customer acquisition.
Moreover, sales from its mobile app rose more than a two-fold year over year in third-quarter fiscal 2020. During the five-day holiday sale period from Thanksgiving to Cyber Monday, the company witnessed year-over-year double-digit growth in overall comps for the core U.S. Bed Bath & Beyond banner, with digital comps up roughly 69%.
For the fiscal fourth quarter, it anticipates positive sales momentum to continue in the digital platform. Encouragingly, the company introduced same-day delivery services on bedbathbeyond.com and buybuybaby.com during the said quarter. Also, it partnered with Shipt and Instacart to provide same-day delivery services to customers of Bed Bath & Beyond and buybuy BABY banners.
Apart from a solid online show, improved gross margin led to adjusted EBITDA growth, which, in turn, drove bottom-line growth in the fiscal third quarter. Notably, the company reported the second successive quarter of growth in profit. It expects adjusted EBITDA margin to be higher year over year in the fiscal fourth quarter on the back of a positive product mix, higher markdowns, better promotions as well as lower distribution and fulfillment costs. Also, fiscal 2020 adjusted EBITDA has been lifted to $500-$525 million, up from $500 million mentioned earlier.
Further, the company is on track with restructuring efforts to achieve improved profits over the next two-three years. Alongside this, the company expects SG&A savings of $85 million from the strategic actions announced in February 2020. Out of these cost savings, management intends to reinvest roughly $150-$200 million in future initiatives. Additionally, it anticipates realizing savings of nearly $150 million and $200 million, respectively, through cost-cutting actions and reduced discretionary costs as well as renegotiations with existing vendors.
As part of such streamlining efforts, the company divested many businesses, which is likely to generate annual SG&A savings of $85 million. This will then be reinvested in omni-channel transformation and to boost shareholder return. Further, the company’s store-network optimization project is likely to generate savings of nearly $100 million on an annual basis. Also, it noted that its non-core portfolio banner work is nearing completion in the fiscal fourth quarter and will position it well for a solid start to fiscal 2021.
However, COVID-related headwinds, including dismal store traffic, significant shipping constraints and increased freight expenses are anticipated to weigh on this Zacks Rank #4 (Sell) company’s top line in the fiscal fourth quarter. In fact, net sales are expected to decline at a double-digit rate, with in-store traffic likely to remain drab.
3 Retail Stocks to Watch
DICK’S Sporting Goods, Inc. (DKS - Free Report) has a long-term earnings growth rate of 5.6% and it currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Tapestry (TPR - Free Report) , with a Zacks Rank #1, has an expected long-term earnings growth rate of 11.7%.
Capri Holdings Limited (CPRI - Free Report) presently has an expected long-term earnings growth rate of 5.6% and a Zacks Rank #2 (Buy).
Zacks Names “Single Best Pick to Double”
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
You know this company from its past glory days, but few would expect that it’s poised for a monster turnaround. Fresh from a successful repositioning and flush with A-list celeb endorsements, it could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in a little more than 9 months and Nvidia which boomed +175.9% in one year.
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