Thread by @TendieBaron

Bed, Bath & Beyond released their strategic update today

Here's all you need to know, in a 🧵👇

I'll start with the elephant in the room:

$BBBY announced that they will offer up to 12 Million shares on the market

The #BBBY buyback program was a FAILURE.

Average buyback price last 2 years: $21.37
Average buyback price since December 2004: $44.68

Today, Bed, Bath & Beyond announced they'll offer 12 million shares, current price is substantially lower at ~$9

Investors are mostly responding to the announced share offering, rather than all of the other changes the company has made, which eliminate short term bankruptcy

Here's what they've announced as well:

Bed, Bath & Beyond secured $500 million in new financing

This including an increase on the ABL facility and the $375M FILO facility from Sixth Street Partners

Bed, Bath & Beyond will close 150 low-performance BBBY stores (~20% of total stores) and will reduce their workforce by 20% in both corporate & supply chain.

This will reduce SG&A by $250 million in FY2022 and lower the forecasted capital expenditures to $250MM, down from $400MM

BBBY will discontinue 3 of its 9 labels and will bring back national brands inventory

BBBY will keep BuyBuyBABY, and will be focused on building its full potential with digital and registry platforms.

Leadership changes:
👉Terminated Chief Operating Officer position
👉Appointed New EVP & Brand President on BBBY
👉Appointed New EVP & Brand President on BuyBuyBABY

The company will continue to search a CEO

Interim financial update shows that sales have declined -26% in Q2FY22 vs Q2FY21, this is inline with previous guidance

TL;DR on BBBY's Strategic Update:
👉 Share offering of 12MM shares
👉 Expanded $500 MM in new financing
👉 20% reduction of workforce & stores
👉 SG&A reduced $250MM in FY22, CapEx reduced $150MM
👉 The company will hold & build on BuyBuyBABY
👉 Short term bankruptcy eliminated

TL;DR on BBBY's Strategic Update:
👉Share offering of 12 million shares is bad for a FTD squeeze play but Freeman + RC sold more than that. With over 2 BILLION sh traded in the past 5.5w (over 25x shares outstanding) wouldn't kill it per se imo
👉Short term bankruptcy eliminated

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Thanks for reading🧡