Analyst: Consolidation may help Bed Bath & Beyond
By
Associated Press
July 23, 2008
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An analyst says Bed Bath & Beyond Inc. is poised to gain market share as the home furnishings industry consolidates.
William Blair & Co. analyst Jack Murphy told investors in a research note late Tuesday that the Union, N.J.-based specialty home retailer will likely benefit if low-end department store chain Mervyns LLC is forced into bankruptcy protection, closes stores or liquidates assets.
"We believe Bed Bath & Beyond is a direct beneficiary of home furnishings industry consolidation," Murphy wrote.
The company particularly stands to benefit in California, where Mervyns operates 128 of its 177 stores. About 62 percent of Mervyns stores are within five miles of a Bed Bath & Beyond.
Murphy, who has an "Outperform" rating on Bed Bath & Beyond stock, said the company will also benefit from the planned closings of more than 200 Linens 'n Things stores.
Clifton, N.J.-based Linens 'n Things is reorganizing under Chapter 11 bankruptcy protection.
Bed Bath & Beyond shares climbed 27 cents to $29.52 in morning trading Wednesday.
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