Bed Bath & Beyond (BBBY -5.23%) continues to show signs that it is on the road back to health as it posted its third consecutive quarter of adjusted profits this morning, beating analyst expectations in its fourth quarter of 2020, though sales fell a little short of the mark.
The home goods retailer also reported its third straight quarter of comparable-store sales growth, suggesting that management has finally gotten a grasp again on what consumers are looking for.
Fourth-quarter revenue of $2.62 billion was down 16% year over year and fell short of analyst expectations of $2.63 billion. Net income of $9.1 million, or $0.08 per share, was a nice U-turn from the $0.53 loss per share a year ago. And adjusting for one-time expenses, that allowed Bed Bath & Beyond to notch profits of $0.40 per share compared to $0.02 last year and well ahead of Wall Street's expectations for $0.31.
Last month the home goods leader unveiled the first of its eight new in-house brands called Nestwell, a broad line of bed and bath merchandise, and followed that up with bath brand Haven, which are goods that offer a spa-like experience.
Bed Bath & Beyond also reiterated its forecast for full-year 2021 sales to be between $8 billion and $8.2 billion with adjusted EBITDA between $500 million and $525 million. The 10% drop in revenue that represents is not surprising, even though its stores were closed for a good portion of 2020, because the retailer shed all of its noncore businesses such as Cost Plus World Market and Christmas Tree Shops.
However, the retailer also remains intent on buying back stock, boosting its share repurchase program from $825 million to $1 billion.