Bed Bath & Beyond, Inc. Earnings: Will Growth Be Back?

The home-furnishings retailer could see tough times for the holiday season, but will it get back into growth mode this year? Find out here.

Apr 8, 2014 at 9:36AM

On Wednesday, Bed Bath & Beyond (NASDAQ:BBBY) will release its quarterly report, and investors are nervous about just how bad the home-furnishings retailer's numbers could be. After a huge plunge back in January, Bed Bath & Beyond's stock has had trouble even as The Container Store (NYSE:TCS) and other competitors have managed to hold their own. With relatively low expectations for this quarter's results, shareholders want to know whether Bed Bath & Beyond can climb back and get onto positive footing again.

Bed Bath & Beyond performed extremely well in 2013, as the rebound in the housing market helped to drive sales for it and its peers throughout the industry. Yet as the economic recovery pushes into a sixth year, Bed Bath & Beyond faces concerns about whether the housing rebound can keep pushing revenue higher. Moreover, competition from The Container Store as well as rival home-furnishings specialists threatens to eat into Bed Bath & Beyond's dominance of the niche. Let's take an early look at what's been happening with Bed Bath & Beyond over the past quarter and what we're likely to see in its report.

Source: Wikimedia Commons, courtesy Coolcaesar.

Stats on Bed Bath & Beyond

Analyst EPS Estimate


Change From Year-Ago EPS


Revenue Estimate

$3.22 billion

Change From Year-Ago Revenue


Earnings Beats in Past 4 Quarters


Source: Yahoo! Finance.

Will Bed Bath & Beyond earnings bounce back?
Analysts have slashed their views on Bed Bath & Beyond earnings in recent months, reducing February-quarter estimates by 10% and cutting more than 6% from their fiscal 2015 projections. The stock has plunged as a result, falling 16% since early January.

Bed Bath & Beyond already gave investors a hint of what was to come when it announced its fiscal third-quarter results in January. The company saw same-store sales rise by only 1.3%, as greater competition ate into its organic growth and its gross margins fell. Overall, revenue rose 6%, and although earnings per share rose by nearly 9%, that gain was smaller than investors had expected. Even worse, Bed Bath & Beyond cut its guidance for the full fiscal year, suggesting that the key holiday quarter had gone worse than planned in comparison to The Container Store and other healthier competitors. Bed Bath & Beyond confirmed that sentiment in March, when it warned that adverse weather had reduced earnings by $0.06 to $0.07 per share and hurt comps by 2 to 2.5 percentage points. The company said that same-store sales likely rose about 1.7%, and its new range for earnings guidance fell below the previous range.

One key issue for Bed Bath & Beyond involves potential saturation of its consumer markets. The company owns not only its Bed Bath & Beyond stores but also several other chains, and combined, Bed Bath & Beyond hasn't aggressively increased the amount of store space across all of its concepts. Recent acquisitions have done a good job of keeping revenue and earnings up, but it's unclear whether further expansion will do Bed Bath & Beyond any good.

Meanwhile, Bed Bath & Beyond has had to fight the rise of online shopping, as its own e-commerce channel has fallen behind those of many of its peers. It's too easy for shoppers to look at physical items at Bed Bath & Beyond stores and then take advantage of discounted prices elsewhere, and that has forced Bed Bath & Beyond to offer margin-crushing coupons. The Container Store reported substantial e-commerce growth during the first half of last year, yet as recently as 2012, Bed Bath & Beyond got just 3% of total sales from online, and the retailer needs to boost that share in order to make a meaningful difference in the e-commerce world.

In the Bed Bath & Beyond earnings report, watch to see whether the retailer can fight off The Container Store and other competitors within the home-furnishings niche. If economic growth does slow down, then it'll be more important than ever for Bed Bath & Beyond to do all it can to keep its share of its industry intact.

Six stock picks poised for incredible growth
They said it couldn't be done. But David Gardner has proved them wrong time, and time, and time again with stock returns like 926%, 2,239%, and 4,371%. In fact, just recently one of his favorite stocks became a 100-bagger. And he's ready to do it again. You can uncover his scientific approach to crushing the market and his carefully chosen six picks for ultimate growth instantly, because he's making this premium report free for you today. Click here now for access.

Click here to add Bed Bath & Beyond to My Watchlist, which can find all of our Foolish analysis on it and all your other stocks.

Dan Caplinger has no position in any stocks mentioned. The Motley Fool recommends Bed Bath & Beyond. It recommends and owns shares of The Container Store Group. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Money to your ears - A great FREE investing resource for you

The best way to get your regular dose of market and money insights is our suite of free podcasts ... what we like to think of as “binge-worthy finance.”

Feb 1, 2016 at 5:03PM

Whether we're in the midst of earnings season or riding out the market's lulls, you want to know the best strategies for your money.

And you'll want to go beyond the hype of screaming TV personalities, fear-mongering ads, and "analysis" from people who might have your email address ... but no track record of success.

In short, you want a voice of reason you can count on.

A 2015 Business Insider article titled, "11 websites to bookmark if you want to get rich," rated The Motley Fool as the #1 place online to get smarter about investing.

And one of the easiest, most enjoyable, most valuable ways to get your regular dose of market and money insights is our suite of free podcasts ... what we like to think of as "binge-worthy finance."

Whether you make it part of your daily commute or you save up and listen to a handful of episodes for your 50-mile bike rides or long soaks in a bubble bath (or both!), the podcasts make sense of your money.

And unlike so many who want to make the subjects of personal finance and investing complicated and scary, our podcasts are clear, insightful, and (yes, it's true) fun.

Our free suite of podcasts

Motley Fool Money features a team of our analysts discussing the week's top business and investing stories, interviews, and an inside look at the stocks on our radar. The show is also heard weekly on dozens of radio stations across the country.

The hosts of Motley Fool Answers challenge the conventional wisdom on life's biggest financial issues to reveal what you really need to know to make smart money moves.

David Gardner, co-founder of The Motley Fool, is among the most respected and trusted sources on investing. And he's the host of Rule Breaker Investing, in which he shares his insights into today's most innovative and disruptive companies ... and how to profit from them.

Market Foolery is our daily look at stocks in the news, as well as the top business and investing stories.

And Industry Focus offers a deeper dive into a specific industry and the stories making headlines. Healthcare, technology, energy, consumer goods, and other industries take turns in the spotlight.

They're all informative, entertaining, and eminently listenable. Rule Breaker Investing and Answers are timeless, so it's worth going back to and listening from the very start; the other three are focused more on today's events, so listen to the most recent first.

All are available for free at

If you're looking for a friendly voice ... with great advice on how to make the most of your money ... from a business with a lengthy track record of success ... in clear, compelling language ... I encourage you to give a listen to our free podcasts.

Head to, give them a spin, and you can subscribe there (at iTunes, Stitcher, or our other partners) if you want to receive them regularly.

It's money to your ears.


Compare Brokers