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Bed Bath & Beyond’s Stock Plunges With Hard Times on the Horizon

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On Wednesday, January 8, third quarter earnings and revenue miss caused the share price of Bed Bath & Beyond Inc (NASDAQ:BBBY) to plunge 8 percent with the retailer withdrawing fiscal 2019 outlook. On Thursday, stock was down 11 percent in premarket trading.

Third quarter earnings

Oh, how the mighty have fallen seems as the appropriate phrase to describe net earnings from of $24.4 million from one year ago dropping to a net loss of $38.6 million. Refinitiv expected earnings of 2 cents whereas the retailer delivered an adjusted loss per share of 38 cents. Revenue dropped 9 percent and amounted to $2.76 billion with same store sales dropping 8.3 percent versus the 5 percent expected. Both sales and profitability are expected to remain under heavy pressure in the fourth quarter as well. The retailer found that its results were significantly impacted by the fact Thanksgiving fell later than usual, resulting in one week less of holiday sales.

Tritton’s shakeup

On Monday, the retailer announced that it accomplished a real estate deal that netted the company $250 million in proceeds, what according to Tritton is the first step towards unlocking valuable capital. And only in December, Tritton decided to let six senior executives go and is currently in the recruitment process for their roles. Bed Bath and Beyond’s turnaround strategy is well underway with these swift changes but surely, there are many more to come as some of these executives have been with the company for more than 20 years – so “out with the old, in with the new” it is.

Intense competition

Amazon (NASDAQ:AMZN) has vigorously shaken up the retail landscape, but Target Corporation (NYSE:TGT) and Walmart Inc (NYSE:WMT) are by no means, left behind, but are in fact doing beyond great as they are successfully luring customers with more attractive websites and speedier shipping. And all of them are selling pretty much all the products that Bed Bath & Beyond has in store, leaving the struggling company in quite a turmoil.
But Amazon is by no means still the emperor sitting on the e-commerce throne as it is literally bleeding out to retain its crown. The world’s biggest online stores is losing money on its sales in order to achieve its shipping policy and in the world of ‘free-shipping’, it seems it could soon be beaten by Walmart, world’s third largest store but America’s largest retailer. And it is growing fast into online retail with its online sales exploding 78 percent up since 2016, but more importantly, now growing twice as fast as Amazon. And here’s the trick, Walmart is using its physical stores as warehouses for online sales. And since these stores are already turning a profit, maintaining extra warehouse space is nothing but a small addition to costs and that makes its strategy far different. Amazon only has 110 warehouses across the US so Walmart will soon have the biggest and more effective shipping network. Although both have great growth potential, Walmart is going full speed ahead in the online retail wars. Not good news for Amazon and especially for poor old Bed Bath & Beyond.

Outlook

CEO Mark Tritton, a Target veteran who started commanding the ship in October has announced that strategic plans for creating a long-term profitable growth will be revealed within the next two months, showing his discontent with these unsatisfactory results which are more than an imperative for change of the current business model. Bed Bath & Beyond desperately needs a new vision and hopefully, Tritton will be able to deliver it, otherwise things could get even worse.

This article is contributed by IAMNewswire.com. It was written by an independently verified journalist and is not a press release. It should not be construed as investment advice.

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BenzingaEditorial

Are spaceflights just around the corner?

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Space Flights Stock Market

Virgin Galactic Holdings, Inc. (NYSE: SPCE), an aerospace company, pioneering in private space flights and manufacturing of advanced air and space vehicles, announced the Q4 and end of year results. Company’s key goal is to open access to space, so it is safe and affordable. Q4 brought the company closer to that goal by finalizing the transaction with Social Capital Hedosophia and becoming publicly listed on the NYSE. All of that affected further operational readiness of the Spaceport America in New Mexico, which is used by tenants like Virgin Galactic, TMD Defense and Space, White Sands Research and Developers and SpinLaunch.

White Sands Research and Developers LLC is based in Las Cruces, and it offers engineering and aerospace services like software development, flight modeling, systems engineering and suborbital launch services. TMD Defense and Space is based in El Paso and they plan to test ballistic missiles in Spaceport. SpinLaunch is a company aiming to move payloads to space with a spaceflight mass accelerator technology.

Tickets for space

Virgin Galactic, bringing Virgin branded customer experience, wants its customers to have a unique experience, lasting more than one day. Not all that time will be spent in space, but the spaceflight should provide real space adventure, views of the Earth and several minutes without gravity. All of this attracted just below 8.000 registrations of interest in flight reservations. This successful increase of interest registrations came after spending the last couple of years upgrading the spacecraft, which has now successfully flown two test flights to space, carrying five people in total (on both flights together).

These registrations of interest in flight reservations cost $1.000,00, and it represents refundable deposit securing a privileged position for future ticket purchase. Previous tickets were sold for $250.000, but we can expect that the company will increase the price, once they restart with ticket selling.

Q4 and 2019 results

When looking at these results, we should have in mind that the company spent several years in development, updating and upgrading its spaceship, with no ticket sales. Q4 revenues were $529,000, summing up to almost $3.8 million for the whole of 2019. That is an increase from 2018 revenues of $2.8 million but 2019 being its first full year of results. Taking into consideration huge research and development expenses, as well as similar SG&A, it is not a big surprise that the company showed a net loss of $73 million in Q4 or $210.9 million for the whole 2019 as it aims to be profitable by 2021. On the other hand, the company finished the year with cash and cash equivalents of $480 million as of December 31, 2019.

Outlook indicators

Virgin Galactic stocks rocketed in 2020. Investors seem to prefer riskier, more imaginative business endeavors. Similar goes for Tesla Inc (NASDAQ: TSLA) as Elon Musk’s SpaceX and even Boeing Co (NYSE:BA) who have their sights set even higher: that being  the moon and eventually Mars. Space travel somehow goes with futuristic electric cars, preferably even with autopilots. But in the meaning, current tech giants’ stocks like Google (NASDAQ: GOOG) and Amazon (NASDAQ: AMZN) with Bezos’ billionaire-backed venture Blue Origin are a trailing a bit, almost seeming as they are not interesting enough. But space flights do seem just to be around the corner.

Here are some interesting details which may give us a better idea  about when we can expect those spaceflights. Virgin Galactic started with the construction of astronaut training and flight preparation area by building the third floor at Spaceport America. The company also moved an additional 70 Virgin Galactic operations personnel from Mojave, CA to Spaceport America, bringing the total number of staff to 145. It also announced the $20 million investment by Boeing’s HorizonX Ventures, forming a strategic partnership. Future astronaut spacesuits will be made in cooperation with Under Armour (NYSE: UA), the company which also agreed to host the recently launched Astronaut Readiness program. All that activity cannot be without any reason. Hopefully, we will see how travel space looks like soon and maybe even gain an the International Space Station – and now that will even go beyond Harry Potter’s 9 and ¾ platform – no offence to J.K. Rowling intended!

This article is not a press release and is contributed by a verified independent journalist for IAMNewswire. It should not be construed as investment advice at any time please read the full disclosure .

IAM Newswire does not hold any position in the mentioned companies. Press Releases – If you are looking for full Press release distribution contact: press@iamnewswire.com Contributors – IAM Newswire accepts pitches. If you’re interested in becoming an IAM journalist contact: contributors@iamnewswire.com

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BenzingaEditorial

Monday and Tuesday’s Market Tumble – Who Is Affected

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Stock Market Tumble

The market is suffering from earthquakes as companies continue to warn about the impact of the COVID-19 virus. Tech juggernaut Apple (NASDAQ:AAPL) was among the first who has already warned of a shortage of iPhones but other US companies are also starting to break a sweat. If the impact is as serious as some investors suspect, it could derail the longest economic expansion in US’s history. That means there are political implications too. Even for US President Donald Trump has made a roaring economy a central part of his re-election bid and such wobbles could make his case for another four years more challenging. Travel companies around the world also continued to suffer. In the UK, among the FTSE 100 the greatest drop was suffered by EasyJet (OTC:ESYJY) , which sank 16.7%, while British Airways owner International Consolidated Airlines Group, S.A. (OTC:ICAGY) was down by more than 9%.

Latest effects on other stocks and markets

Which stocks and markets will suffer the most from the outbreak will depend on several factors, like where the virus will spread, the number of affected people, market position and what market mostly relies on the infected area, etc. Some markets may fight for a while, but eventually, they are bound to feel the impact. This means that the entire U.S. stock market could be exposed. The last few days have been full of heavy selling at a quick pace, and the market felt down for four days straight.  The S&P 500 index fell for approximately 3%, the Dow Jones Industrial Average for 3.15%, as well as NASDAQ composite for 2.8%. Some of the best ETFs also suffered some decreases. The iShares Expanded Tech-Software Sector ETF (IGV) dropped 2.8%, while the Innovator IBD 50 ETF (NYSE:FFTY) slipped 3%. The VanEck Vectors Semiconductor ETF (NYSE:SMH) had a similar result and lost 2.9%. These several days of heavy selling really placed the market under pressure on Monday and Tuesday, but after that tumble for several days, the indexes and indicators started coming back to normal and higher values.

Tesla Inc

Tesla Inc. (NASDAQ:TSLA) stock has been in a negative trend since the week began, and it  fell more than 7% on Monday, mainly due to fears of the spread of the pandemia and its effect on the world economy. Having in mind that one of three Tesla’s Gigafactories is in Shanghai, the virus outbreak might be a significant slowdown and temporary barrier for Tesla’s plans. Having in mind that the company is quite dependent on its China factory, while the competition has a little better diversification of its assets, Tesla might be more concerned than other auto manufacturers. This comes at a not-so-great time as Tesla has been working on meeting all the requirements to add its stocks to S&P 500 index in order to push its stock further.

Bob Chapek steps in as Disney’s new CEO

Prematurely stepping down of Disney’s (NYSE:DIS) long-serving CEO Bob Iger pushed Disney’s stocks to its lowest values since April 2019. First, the stock fell during Monday’s tumble for 4.3% and continued to decrease on Tuesday for 3.6%. Bob Chapek, who has led Disney Parks, Experiences and Products since 2018, will take over as CEO. The initial plan was that Iger resigns in 2021. But he will stay with the company, directing future “creative endeavors”.

Salesforce co-CEO also steps down

Keith Block, Salesforce’s (NYSE:CRM) co-CEO since 2018, announced he is stepping down, leaving the company founder Marc Benioff as the single CEO. This all came after several straight days of stock decrease. Maybe this was a surprise for some, since many saw Block as next in line as Salesforce’s sole CEO if Benioff decided to withdraw. The announcement also stated that Block will remain close to the company on advising position.

Outlook

The Fed sees the Coronavirus as the threat to global growth. Moreover, some analysts find it could burst some bubbles, as in the case of Tesla. Investors have been trying to make sense of what the coronavirus means for businesses since January, but many fear that the market has underestimated its impact and that we’re in for a severe correction.

This article is not a press release and is contributed by a verified independent journalist for IAMNewswire. It should not be construed as investment advice at any time please read the full disclosure.

IAM Newswire does not hold any position in the mentioned companies. Press Releases – If you are looking for full Press release distribution contact: press@iamnewswire.com Contributors – IAM Newswire accepts pitches. If you’re interested in becoming an IAM journalist contact: contributors@iamnewswire.com

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BenzingaEditorial

Technology Lesson for the New Era – Can You Do It Twice?

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Microsoft News

Whether we like it or not, the big tech firms have shaped our everyday lives and continue to influence them. But recent times have also brought increased legislation as lawmakers do their best to limit the power and influence of these companies. It remains to be seen whether they will succeed as there is an abundant range of both and the good that technology has brought into our existence. But what is interesting is that this constantly-changing landscape has one consistent theme. And that is companies that dominate one paradigm shift rarely dominate the next, even if they see them coming. It’s almost like saying that invention comes only once? Then again, there are some giants who might even manage to break this pattern.

The kingdom of PCs and Clouds and Mobiles

IBM (NYSE:IBM) saw PCs coming yet it outsourced the most valuable aspect of the technology to Microsoft (NASDAQ:MSFT) and Intel (NASDAQ:INTC). Microsoft and Intel in turn dominated PCs, yet they did not manage to do the same with the mobile market. And they saw it coming way before Apple (NASDAQ: AAPL) even introduced the iPhone – so well done to Steve Jobs. Apple has made us go crazy over the iPhone indeed but it has been relatively unsuccessful in the cloud sector compared to its competitors.

Can you see a pattern? Or not!

Focusing further on Microsoft and Apple as examples: Microsoft dominated PCs, missed in mobile, but retooled and is now a giant in cloud services. A giant so big that it has beaten Amazon (NASDAQ:AMZN)  in winning the Pentagon’s JEDI contract. Although Amazon is still determined in not letting happen and the judge stopped the contract from realisation until the lawsuit is resolved, the potential of Microsoft, the reason for which it was chosen, is undebatable.

Apple was a leader in very early PCs only to lose that battle to Microsoft and Intel, so it was able to retool its entire business to focus on mobile. But that ultimately made it difficult to build a big cloud business, even though Apple was early in offering cloud services to consumers. And now? Apple is repositioning  itself on being a service company. No need to feel sorry for Apple as it recently reported its record first quarter results. Will Apple TV Plus manage to eclipse the emperor Netflix (NASDAQ:NFLX) who also surpassed expectations for its latest quarter, along with intense competition from Disney (NYSE:DIS) and others is an entirely different question! And all bets are in!

The takeaway

These companies were built with an idea to disrupt the status quo but the truth is that they are back at square one when the next shift begins. And the pace is only getting quicker.  In the end, they also find themselves asking the same questions as the companies they disrupted before- why change everything about your disrupt your highly profitable core? That core business is afterall, one’s ‘baby’. So to make it less painful, it seems the best thing to do is shift the direction immediately after it’s become apparent you’ve lost just one round and leapfrog to a new one that you can build a business around. Baby steps are key, even for giants as this can only make them flexible enough to follow through change.

This article is not a press release and is contributed by Ivana Popovic who is a verified independent journalist for IAMNewswire. It should not be construed as investment advice at any time please read the full disclosure . Ivana Popovic does not hold any position in the mentioned companies. Press Releases – If you are looking for full Press release distribution contact: press@iamnewswire.com Contributors – IAM Newswire accepts pitches. If you’re interested in becoming an IAM journalist contact: contributors@iamnewswire.com Questions about this release can be send to ivana@iamnewswire.com

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