BofA analyst Curtis Nagle tagged a 'buy' rating on Bed Bath & Beyond shares, while holding his $38 price target in check, as he argued that "meme investing" momentum, as well as short interest, has likely subsided. He also sees Bed Bath & Beyond on track for its target of between $850 million and $1 billion in earnings by 2023.
That said, short interest in the shares remains elevated, with recent data from S3 Partners showing just over $918 million in bets against the group, a figure that represents around 31.1 million shares, or30% of the outstanding float.
Bed Bath & Beyond shares were marked 2% higher in early trading Thursday to change hands at $29.95 each, a move that would extend the stock's year-to-date gain to around 72%.
Bed Bath & Beyond is forecasting net sales in the region of $8 billion to $8.2 billion and adjusted earnings of between $500 million and $525 million as part of its aggressive turnaround strategy under CEO Mark Tritton.
The group said it sees free cash flows of between $500 million and $1 billion over the next three years, and low to mid single digit growth in comparable sales for its 2023 financial year. Sales for 2023 are expected to rise to around $1.5 billion, the company said late last year.
"We will build on these strong foundations with a three-year growth strategy that further elevates the shopping experience, modernizes our operations, and unlocks sales growth, margin expansion, increased cash flow and strong and sustainable total shareholder return," Tritton said.