Bed Bath & Beyond Inc. (BBBY) is a retailer operating in two segments: North American Retail and Institutional Sales offering products in-store, online or through a mobile device. The Company also operates Linen Holdings, a provider of textile products. The stock is currently trading around $70.74 at the upper end of its 52 week range of $54.96-$79.64. The stock has been underperforming the market this year falling by 7.11% year to date. BBBY is scheduled to report earnings after the closing bell tomorrow, and the stock is bullish today rising by $0.22 or 0.31% on the session ahead of the close.

Over the past 12 quarters BBBY has rallied on earnings day 3 times with an average move of 6.65%. The stock appears bearish on a chart going into the release having traded below the Ichimoku Cloud for the past few months since about mid-April on the daily bars. Over the past 12 quarters BBBY has rallied from earnings to the nearest options expiration 4 times with an average move of 7.86%. The stock looks as if it could reverse its trend and lower in today’s session. Investors are mainly looking to see how the company fares with strong currency headwinds and prolonged slowdown at a port on the West Coast. Margins are expected to be impacted due to higher coupon expenses and direct-to-consumer shipping costs. The company also hinted at a rise in SG&A costs.

The options market is currently implying a move of around $3.92 or 5.5% in BBBY by this Friday’s close giving us targets of $66.79 and $74.63.

Andrew Keene

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