BofA cuts Bed Bath & Beyond target to $3, says buybuy BABY sale unlikely

BofA analyst Jason Haas lowered the firm’s price target on Bed Bath & Beyond to $3 from $8 and keeps an Underperform rating on the shares ahead of the company’s fiscal Q1 results on June 29. The stock closed Tuesday at $6.70. The analyst cut his Q1 earnings per share estimate to ($1.41), below the consensus of ($1.31), on down 20% same-store-sales. On the Q4 call, management cited quarter-to-date comps running down 20%, and they likely have not improved since, Haas tells investors in a research note. He says Bed Bath company continues to run elevated promotions, including up to 50% off bedding and furniture, free same day shipping, $10 off a $30 purchase and 20% off all purchases for college students and their parents. Haas also views a sale of buybuy BABY as “increasingly unlikely” given Bed Bath’s “worsening financial position and increasing high yield spreads.”