BBBY reports earnings after the bell today, and investors are eager to see what the home furnishing’s giant has in store.

Bed Bath & Beyond Inc. is a chain of retail stores, operating under the names Bed Bath & Beyond, Christmas Tree Shops, Harmon and Harmon Face Values, buybuy BABY and World Market or Cost Plus World Market. The Company sells a range of domestics merchandise and home furnishings.  BBBY is currently trading around $62.76 in a 52-week range of $54.96 – 80.82. The company’s stock has been underperforming the market this year with shares declining 21.66% year to date.

Morgan Stanley’s home-furnishings survey conducted in August was released Monday, and found almost 80% of shoppers at Bed, Bath & Beyond in the past three months listed the company’s 20% off an-item coupon as what drove them to the store, much higher than other factors including selection or quality of merchandise. Analysts surveyed by FactSet estimated the company earned $1.14 a share, down from $1.16 a share. The retailer in June cut its profit outlook for the second quarter to $1.08 to $1.16 a share. Increased usage of coupons and online spending are expected to be hurt profit margins.

Historical data shows that for the past 8 earnings reports, BBBY has moved an average of 6.1%, with 6 out of 8 last reports moving the stock to the downside. The near-term at-the-money straddle is implying a 6% move in the stock, which is right in line with past performance.

Andrew Keene
KeeneOnTheMarket.com

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