Why Stocks of Bed Bath and Beyond (BBBY) Are Rising Today

Bed Bath & Beyond Inc. (BBBY _) recently declared its plans for financial restructuring. The company announced the offering of its senior unsecured priced notes belonging to three separate series, with a total of $1.5 billion. Following this announcement shares rose 1.56% to a price of $60.13.

The first set includes notes that are worth $300 million, whereas the second category of notes is worth $300. Lastly, the final set of notes is worth around $900 million.

The home furnishings and small appliances retailer also proposed to engage in a $1.1 billion worth accelerated share buyback program, after concluding the offering. The company plans to use the proceeds from the offering to buy back shares.

Bed Bath also stated that they plan to make arrangements for an unsecured senior revolving credit facility worth $250 million with lender, scheduled to expire in 2019.

The rating team at TheStreet gave BED BATH & BEYOND INC a rating of “Buy” and a B- score. They also said, in support of their recommendation that the rating was powered by some key strengths which they believed had a stronger impact than any of the company’s weaknesses. This also provides the investors with the opportunity to perform better than most of the other stocks the team covers. They further added that these strengths could be highlighted in several of the areas including remarkable equity return, revenue growth, the increasing profit margins and rational valuation levels. They felt that these strengths were more significant than the company’s insufficient net income growth.

The analysis also highlighted that the revenue growth of BBBY had outpaced the 0.9% figure of industry average. Revenues also rose slightly by 1.7% from the same quarter last year. The company’s revenue growth also did not fall to its bottom line, exhibiting still Earnings Per Share values.

There is a slight improvement in Return on Assets figures from the similar quarter last year which can be interpreted as a satisfactory strength of the company. In contrast to overall market and other organizations working in Specialty Retail market, ROA of BED BATH & BEYOND INC exceeds industry average and also surpasses the S&P 500.

Stagnant Earning per share for BED BATH & BEYOND have been reported in the most recent quarter along with volatile earnings. But there is assurance for growth of EPS in the following year. BED BATH & BEYOND INC, during the last fiscal year, increased the bottom line from $4.58 to $4.81. This year, an even greater improvement is expected in earnings from $4.81 to $4.96.

BED BATH & BEYOND INC’s gross profit margin stands at 38.80% which is considered a strong number. Despite the company’s good profit margin, BBBY has still managed to drop from the similar quarter last year. Despite the mixed bag of results as far as gross profit margin is concerned, the company’s overall net profit margin values 7.04% which still follows closely behind the industry average.