By Senad Karaahmetovic
Shares of Bed Bath & Beyond (NASDAQ:BBBY) are down over 5% today after a Raymond James analyst downgraded to Underperform from Market Perform.
The downgrade call comes a day after BBBY yesterday presented a survival plan that is based on new financing, the closure of some stores, and the sale of 12 million shares.
The analyst finds it “challenging to even maintain our neutral rating given the current trends of the business and ongoing cash burn.”
While the analyst acknowledges that the new financing will improve the company's financial position, he adds that “underlying business trends remain abysmal.”
“We feel an Underperform rating is better suited versus our prior Market Perform. We would look to change our view if we see signs of consistent cash flow generation again and a stabilization in sales trends,” the analyst further added in a downgrade note.
Also reflecting on yesterday’s updates, a Bank of America analyst slashed the price target to $2 per share (from $2.40) to reflect lowered outlook.