Bed Bath & Beyond To Expect Drop In Sales
This week an analyst stated that Bed Bath & Beyond is going to lose consumers throughout the coming months. The home furnishings retailer was hoping that when Linens ‘n Things closed some of the store as part of a bankruptcy plan business would pick up. However, that doesn’t seem to be the case.
PiperJaffray analyst Neely J.N. Tamminga said in a research note that consumers are more likely to turn to lower-priced home furnishings, and discounters are more likely to benefit from the Linens ‘n Things 120 store closures.
About 84 percent to 86 percent of stores being closed are within a five-mile radius of a Target, Pier 1 Imports or Wal-Mart, while just 55 percent are within a five-mile radius of a Bed Bath & Beyond store, Tamminga wrote.
“In our view, this does not bode well for Bed Bath & Beyond as we believe consumers are more likely to shift their home furnishings spending from Linens ‘n Things to a discount store in closer proximity,” Tamminga wrote.
She reiterated her “Sell” rating on Bed Bath & Beyond with a price target of $25. That implies downside of 22.9 percent from the stock’s Tuesday closing price of $32.42.