Bed Bath and Beyond (Nasdaq:BBBY) is about to release earnings. Ponder this Bear Case Caveat:
Increased promotional activity by all home furnishing vendors makes margins small and difficult. home furnishings is becoming hyper-competitive and not viable economically.
New home buyers are a large significant portion of sales. If new housing sales drop which they will BBBY will suffer very quickly.
Margins are under pressure from e-commerce sites and other low switch cost alternatives. BBBY has not found a way to beat them off.
George Gutowski writes from a caveat emptor perspective.