Public since the early 1990s, Bed Bath & Beyond has been a massive growth story for years. The company has faced some serious growing pressure in recent history, but management turned to stock buybacks to juice up the returns again. Now shares are relatively near all-time highs, although they have receded recently. What is amazing is that no dividend has been paid in a 20-year history. With only about 3% revenue growth being the norm, it is time to start rewarding investors here by paying them to own the stock.
Bed Bath & Beyond is worth about $12 billion in market cap, but it has bought back over $7 billion in stock since 2004. It has only about $1.5 billion in long-term debt. Acquisitions have also been a source of growth, but at 15 times earnings, Bed Bath & Beyond could easily fund a 1.5% to 2.0% dividend yield — and still have more than enough liquidity for opportunistic contingencies or for more buybacks, if they save the buybacks for when shares are weak.
Prior to the earnings being released, a couple of analysts weighed in on Bed Bath & Beyond:
- Wedbush has a Hold rating for Bed Bath & Beyond with a $70 price target.
- Cantor Fitzgerald initiated coverage with a Buy rating and an $83 price target.
Shares of Bed Bath & Beyond were up 0.4% at $70.79 late on Tuesday. The stock has a consensus analyst price target of $75.50 and a 52-week trading range of $54.96 to $79.64.
ALSO READ: The Best and Worst States to Be Unemployed
Is Your Money Earning the Best Possible Rate? (Sponsor)
Let’s face it: If your money is just sitting in a checking account, you’re losing value every single day. With most checking accounts offering little to no interest, the cash you worked so hard to save is gradually being eroded by inflation.
However, by moving that money into a high-yield savings account, you can put your cash to work, growing steadily with little to no effort on your part. In just a few clicks, you can set up a high-yield savings account and start earning interest immediately.
There are plenty of reputable banks and online platforms that offer competitive rates, and many of them come with zero fees and no minimum balance requirements. Click here to see if you’re earning the best possible rate on your money!
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.