BBBY, BKE

Bed Bath & Beyond Inc.

Consumer


Presented:11/07/2014
Price:$69.88
Cap:$12.90B
Current Price:$0.08
Cap:$0.06B

Presented

Date11/07/2014
Price$69.88
Market Cap$12.90B
Ent Value$13.16B
P/E Ratio15.72x
Book Value$16.19
Div YieldN/A
Shares O/S185.24M
Ave Daily Vol2,590,000
Short Int9.50%

Current

Price$0.08
Market Cap$0.06B
Bed Bath & Beyond Inc., together with its subsidiaries, operates a chain of retail stores. It sells a range of domestic merchandise, including bed linens and related items, bath items, and kitchen textiles; and home furnishings, such as kitchen and tabletop items, fine tabletop, basic housewares, general home furnishings, consumables, and certain juvenile products. The company also offers health and beauty care items, and giftware and household items, as well as infant and toddler merchandise. Bed Bath & Beyond Inc. operates stores under the names of Bed Bath & Beyond (BBB); Christmas Tree Shops; Christmas Tree Shops andThat! or andThat! (CTS); Harmon or Harmon Face Values (Harmon); buybuy BABY (Baby); and World Market, Cost Plus World Market, and Cost Plus (Cost Plus World Market). In addition, it provides various textile products, amenities, and other goods to institutional customers in the hospitality, cruise line, food service, healthcare, and other industries. As of May 31, 2014, the company operated 1,504 stores consisting of 1,016 Bed Bath & Beyond stores in all 50 states, the District of Columbia, Puerto Rico, and Canada; 268 stores under the World Market, Cost Plus World Market, or Cost Plus names; 92 buybuy BABY stores; 78 stores under the Christmas Tree Shops, Christmas Tree Shops andThat!, or andThat! names; and 50 stores under the Harmon or Harmon Face Values names. Bed Bath & Beyond Inc. was founded in 1971 and is headquartered in Union, New Jersey.

Publicly traded companies mentioned herein: Bed Bath & Beyond Inc (BBBY), The Buckle Inc (BKE), Keurig Green Mountain Inc (GMCR)

Highlights

Bed Bath & Beyond (BBBY) and The Buckle (BKE) are very different retailers that the presenter said share one material trait. Both companies sell third party products, not their own brand(s). Both retailers appear to be over-earning on a gross margin basis, and over time the current level of margins are “completely unsustainable.” He is short both stocks, and sees ~30% downside risk in shares of BBBY, and ~40% for BKE over the next 12-24 months.

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Idea Discussion

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