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.
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.
