Bed Bath & Bust

Bed Bath & Bust

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One day after announcing to investors and customers that it may not be able to remain in business, the value of Bed Bath & Beyond shares has continued to decline. In the past year, the widely recognized meme stock has plummeted in value, currently trading at around $1.30, representing a loss of almost 90%. Additionally, the stock lost 23% of its current value just on Friday’s intraday trading period.

The CEO released a statement on Thursday regarding the uphill battle the company is facing.

“While the Company continues to pursue actions and steps to improve its cash position and mitigate any potential liquidity shortfall, based on recurring losses and negative cash flow from operations for the nine months ended November 26, 2022, as well as current cash and liquidity projections, the Company has concluded that there is substantial doubt about the Company’s ability to continue as a going concern,” CEO Sue Gove stated.

In previous months, the company had publically announced it would close 56 stores along with a plan to turn around the business. The plan included remodeling hundreds of stores, along with giving a heavier focus on the e-commerce side of the business. That plan has not been working. BB&Y is facing several difficulties; including a lack of merchandise to stock its shelves and a decline in customers visiting its stores and website. Additionally, the company has been unable to refinance a portion of its debt, only a few weeks after announcing its intention to borrow more money in order to pay off some of its existing obligations.

Bed Bath & Beyond’s stock is currently valued at $115 million, with a bleak debt burden for future prospects. The retailer has $1.2 billion in unsecured notes due in 2024, 2034, and 2044. The company has warned that it has been using up its cash reserves quickly in recent quarters. The value of these notes has also been trading below their face value, indicating financial distress.

The “Beyond” seems to be the only horizon left for the once heralded chain.

 

Liam Fegan
Liam Fegan
Lockheed Martin Financial Analyst since June of 2018. If you want a better life, raise your standards and don't compromise them.
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