Bed Bath & Beyond Stocks Surged By 22 Percent After It Named Its New CEO
US retailer Bed Bath & Beyond just had its best day since March as it saw it's stock prices climb by as much as 22 percent on Wednesday. The rise in the company's stock occurred right after it announced that it had finally hired a new chief executive to lead the company ahead of the holiday shopping season.
For over four months, Bed Bath & Beyond had been on the lookout for a new chief executive to help it turn around its business. This week, the company named former Target chief merchandising officer, Mark Tritton, as its new CEO.
The executive had been working with Target for the past three years, helping it build its furnishings and clothing brands. Prior to working for Target, Tritton had been connected with other major retailers, including Timberland, Nike, and Nordstrom.
The company's decision to hire Tritton was met with enthusiasm on Wall Street as evident in the rise in the company's stocks. Tritton's performance at Target does speak for itself as the company has been having a blockbuster year with its stock up by over 67 percent since January. Target previously upgraded its profit forecast for the rest of the year given its performance in the first two quarters.
Bed Bath & Beyond is banking on Tritton to do much of the same for the company and to hopefully turn its business around. The retailer has been having trouble keeping its bottom-line performance on par with its rivals. Bed Bath & Beyond is currently behind other US retailers such as Walmart, Target, and Amazon in terms of revenues.
Stakeholders have long tried to convince the company to attempt to implement a new strategy to improve performance. In March, a group of stakeholders, which held a roughly 5 percent stake in the company, called on it t overhaul its entire board of directors and CEO to steer its business into a new direction. This served as a wakeup call for the retailer, which immediately took action.
In May, Bed Bath & Beyond announced that it had overhauled its board of directors and then CEO Steven Temares had left the company. Temares temporary replacement, interim CEO Mary Winston, vowed to make changes within the company to bolster its growth.
Bed Bath & Beyond announced in its earnings call last week that it would be closing a significant portion of its brick-and-mortar stores in the coming months as a way to cut operational costs. The move was also partly due to the fact that the company had reported a drop in its in-store sales by more than 6.7 percent in the second quarter.