Bed Bath & Beyond (NASDAQ:BBBY) recently announced a new amendment to its equity offering that should help it land up to another $100 million if it can go through. Investors, not surprisingly, are unhappy, as the stock is once again down in today’s trading.
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The amended agreement will allow the company to purchase stock—Series A convertible preferred stock, specifically—that was previously issued back in February. Further, Bed Bath & Beyond also changed the “price failure threshold” to $1, which will change again on April 3. Meanwhile, the threshold share amount was also adjusted and increased to 24,739 shares, all told. With these amendments, Bed Bath & Beyond can land more funding and brings the total amount to $460 million.
Given that Bed Bath & Beyond shares have nearly collapsed in the last year—they’re down 94% from this time last year—it’s no surprise that Bed Bath & Beyond is trying to raise what cash it can. Back in late January, it made it clear that it simply couldn’t pay its suppliers. That’s about as close to a corporate death knell as anyone wants to be. However, in mid-February, it moved to offer suppliers payment upfront.
Analysts aren’t holding their breath for success. Bed Bath & Beyond currently rates a Strong Sell based on analyst consensus, with a unanimous six Sell recommendations. However, BBBY stock also unfathomably offers 5.68% upside potential thanks to its average price target of $1.21 per share.
