Editor's Note: Below is a brief complimentary note on our short Bed, Bath, & Beyond (BBBY) research call from our Retail analysts Brian McGough and Jeremy McLean.  

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QUICK HIT | Blood, Bath & Beyond $BBBY - 2022 08 31 10 28 22

Blood, Bath & Beyond.  The company is revising down revenue again now expecting comps down 20% for the year with 2Q coming in at -26%. Entering into a cost cutting program of $250mm and reducing capex plan to $250mm from $400mm and closing 150 stores. 

That’s all happening for a company that is already too lean (no employees in the store and the A/C turned off) and has become irrelevant due to underinvestment over the last decade. 

Cost cutting will just accelerate the demise of the model in terms of customer relevance. 

The company has a liquidity problem, added $500mm in new debt financing, and it’s set up a 12mm share ATM offering.  So crashing business, too much debt, diluting equity and cutting investment into the business model. 

As we outlined in our “Bone, Bagger, or Bust” Black Book, this is a bust.

FLASHBACK--> McGough: Bed Bath & Beyond Is “Going To Zero” (8/18)

In this clip from The Call @ HedgeyeRetail analyst Brian McGough reiterated his bold short call on Bed Bath and Beyond (BBBY) in the face of its “meme stock” bounce.

"To be clear...This stock is going to zero," says McGough. "The stock will trade down big here today, even if it's down 20, 30%, I would still short it. Just hammer this thing."

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