Two Bed Bath & Beyond insiders buy as the retailer reports positive cash flow in June.


Two Bed Bath & Beyond insiders bought shares as the slumping retailer published an investor update describing improving June sales trends. After announcing dismal Q1 Covid-19-impacted earnings on July 8, Bed Bath & Beyond (BBBY) management received lots of questions from investors. So on Tuesday, the company released a list of “Frequently Asked Questions.” In the Q&A, management said that June cash flow had turned positive. The upbeat Q&A sent shares up 9% on the day, closing at $8.39.

Bed Bath & Beyond insiders disclosed in Form 4 filings on Tuesday that they bought into BBBY’s post-earnings report weakness. Director Ann Yerger bought 6,000 shares on July 10 @ $8.29, increasing her holdings by 53%. Director Sue Gove bought 34,000 shares at $7.89 on July 13, increasing her holdings by 408%.

The open market purchases represent the first Bed Bath & Beyond insider buying since Sept. of 2005.

Despite Tuesday’s rally, BBBY is down 26% since hitting it post-pandemic crash high of $11.45 on July 2. The shares are down over 50% year-to-date.

BBBY is selling up to 20% of its real estate portfolio as part of a restructuring plan.

The Covid-19 pandemic and subsequent consumer lock-down has taken a toll on the home accessories retailer. The disappointing earnings report last week disclosed that in-store sales plunged 77% due to the pandemic. While BBBY saw a 82% jump in e-commerce sales, total revenue collapsed 49% from the same period a year ago.

In response, Bed Bath & Beyond will close up to 200 stores as part of a restructuring move designed to reduce annual costs by $250-$350 million. The retailer will also implement a more digital focus, intended to serve E-commerce demand for home furnishings minus the overhead of its sprawling brick and mortar store network. While online sales have surged, many stores are generating losses despite generating nearly $1B in annual sales.

The two Bed Bath & Beyond insiders appear to have timed their stock purchases to take advantage of weakness after last week’s dismal earnings report. They’re apparently betting that after a tough period, BBBY stock will move higher in the months ahead.

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