Bed Bath & Beyond's shares slumped after a surprise fall in Q1 comparable sales. Fred Katayama reports.
Bed Bath & Beyond's shares plunged on Friday after the company reported a surprise two-percent drop in its first quarter comparable sales the day before. At least nine brokerages cut their price targets on the stock. Deutsche Bank said in a research note the comparable sales fall was the worst since 2008: "BBBY's results are not getting much better. In fact, on most metrics, not only did BBBY miss estimates, but relative to previous quarters, results are getting worse." Jerry Braakman of First American Trust: (SOUNDBITE) JERRY BRAAKMAN, CIO, FIRST AMERICAN TRUST (ENGLISH) SAYING: "It's really getting killed by places like Amazon online, where people can get delivery to their home, and it's just a step-down. As soon as it happens, management will come out. They'll restructure, close some stores and that might be a trade, but I think the long-term fundamentals for Bed Bath & Beyond are not optimistic." Bed Bath & Beyond said it saw strong twenty-percent sales growth in its digital channels. But it also accounted for higher shipping expenses, coupon expenses and advertising costs. Profit plummeted. The company's stock has fallen more than twenty percent in the last 12 months. During the same period, the S&P 500 Consumer Discretionary index rose nearly 15 percent.