Bed Bath & Beyond Inc. (NASDAQ: BBBY) is scheduled to release its fiscal third-quarter financial results after the markets close on Wednesday. The consensus estimates are calling for $0.02 in earnings per share (EPS) and $2.85 billion in revenue. The same period of last year reportedly had $0.18 in EPS and $3.03 billion in revenue.
The company has just closed a huge sale-leaseback transaction, generating over $250 million in net proceeds. Overall, Bed Bath & Beyond sold roughly 2.1 million square feet of commercial space, including retail stores, a distribution facility and office space. The company will continue to occupy these properties pursuant to long-term leases.
The proceeds from this transaction may be used to reinvest in the company’s core business operations/ongoing business transformation efforts to drive growth, fund share repurchases, reduce the outstanding debt or some combination of these options.
Mark Tritton, Bed Bath & Beyond president and chief executive, commented:
We are pleased to complete this sale-leaseback transaction. This marks the first step toward unlocking valuable capital in our business that can be put to work to amplify our plans to build a stronger, more efficient foundation to support revenue growth, financial stability and enhance shareholder value.
Excluding Wednesday’s move, Bed Bath & Beyond had outperformed the broad markets, with the stock up about 39% in the past 52 weeks. Over the past quarter alone, the stock was up closer to 65%.
A few analysts weighed in on Bed Bath & Beyond ahead of the report:
- Merrill Lynch has a Buy rating and a $24 price target.
- Loop Capital has a Hold rating with a $15 price target.
- Telsey Advisory Group rates it as Outperform with an $18 target.
- Wedbush’s Outperform rating comes with an $18 price target.
- Raymond James has a Buy rating.
- Morgan Stanley has a Hold rating with a $12 price target.
- UBS has a Neutral rating with an $11 target price.
Shares of Bed Bath & Beyond traded down less than 1% at $16.75 on Wednesday, in a 52-week range of $7.31 to $19.57. The consensus price target is $14.75.
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