On brink, Bed Bath & Beyond and Party City see wild stock moves

The one-two punch of lingering inflation and more cautious consumer spending in 2022 has two household retailers — Halloween outfit destination Party City (PRTY) and residential goods retailer Bed Bath & Beyond (BBBY) — on the point of extinction and irrelevancy within the age of digital shopping.

With bankruptcy potentially looming for every, share prices have seen outsized swings amid speculative bets by traders on their respective futures.

Bed Bath & Beyond stock popped greater than 20% early Wednesday after a 20% post-earnings rally on Tuesday. The stock is up nearly 10% to this point in 2023.

Party City stock surged greater than 15% in early Wednesday trading after the stock boomed 117% on Tuesday, making it one among the hottest tickers on the Yahoo Finance platform. It’s up greater than 40% to this point this 12 months.

Here’s each company’s current state of play.

Bed Bath & Beyond

Bed Bath & Beyond continues to struggle mightily: The ailing retailer released its long-awaited holiday quarter results on Tuesday, and the image was not pretty.

Listed here are seven numbers that stood out to Yahoo Finance:

  1. Net sales crashed 33% from the prior 12 months.

  2. Comparable digital sales fell a whopping 33%.

  3. Bed Bath & Beyond banner comparable sales plunged 34%.

  4. BuyBuyBaby banner comparable sales tanked within the “low 20” percentage area.

  5. Adjusted operating lack of $225 million.

  6. Only $153.1 million in money on the balance sheet.

  7. 150 stores still expected to be closed.

In an approximate 10-minute earnings call with no analyst questions, Bed Bath & Beyond CEO Sue Gove outlined $80 million to $100 million more in cost cuts. Other than store closures, the corporate plans to put off much more corporate employees.

Bed Bath & Beyond recently said bankruptcy was on the table as it really works to shore up its tattered balance sheet after the disastrous holiday shopping season.

Gove reiterated on Tuesday that every one options remain on the table to avoid wasting the retailer.

People shop for vacuum cleaners at a Bed Bath & Beyond store in Latest York on January 5, 2023. (Photo by Ziyu Julian Zhu/Xinhua via Getty Images)

Party City

The retailer’s slow-motion train wreck of a 2022 sped up for the all-important Halloween selling season.

In early November, Party City said total third-quarter sales fell 1% from the prior 12 months while gross profit margins dropped 420 basis points. Party City posted an adjusted net lack of $157.2 million for the quarter. Sales for the month of October only rose 3.9%.

“We’re focused on $30 million of savings, with work already underway to deliver this goal in 2023, including a company workforce reduction of 19% through a mix of position eliminations and never backfilling a big variety of open positions,” CEO Brad Weston said on the time.

The Wall Street Journal reported on Jan. 6 that the retailer was preparing to file for bankruptcy in an effort to chop greater than $1.3 billion in debt, sending the shares spiraling lower.

On Jan. 11, Bloomberg reported the corporate was looking for debtor-in-possession (DIP) funding to maintain its business afloat throughout the bankruptcy process. The corporate could enter bankruptcy inside weeks, the report said.

Party City operates 825 stores. The stock has lost about 97% previously five years.

Party City didn’t return Yahoo Finance’s request for comment on a possible bankruptcy filing.

Brian Sozzi is an editor-at-large and anchor at Yahoo Finance. Follow Sozzi on Twitter @BrianSozzi and on LinkedIn.

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