Summary
Online sales have grown at +20% every year.
They now account for 16.1% of total revenue.
Extreme couponing really only accounted for 40 basis points in margin erosion.
Relative to its peers, the market has priced BBBY as if it’s going bankrupt.
Investors decided that they'd rather park their money in cash and leave Bed Bath & Beyond (BBBY) for dead. The stock has taken a nose dive from $80 in 2015 to below $15 today. That's pretty remarkable given that the company's revenues are a touch higher today. So why the massive decline?
Analysts point to the company's inability to stem the erosion in margins. Even with higher revenues operating income halved from just a year ago as did net income. Management seems to be somewhat complacent about the decline in profits. They continue to stick to their guns on their investments and turnaround strategy.
