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As of today (2024-04-27), Bed Bath & Beyond's intrinsic value calculated from the Discounted Earnings model is $-226.89.
Note: Discounted Earnings model is only suitable for predictable companies (Business Predictability Rank higher than 1-Star). If the company's predictability rank is 1-Star or Not Rated, result may not be accurate due to the low predictability of business and the data will not be stored into our database.
Bed Bath & Beyond's Predictability Rank is 1-Star. Thus, this page is only used for demonstration purposes and the DCF related results in the screener and portfolio will appear as zero.
Margin of Safety (Earnings Based) using Discounted Earnings model for Bed Bath & Beyond is N/A.
The historical rank and industry rank for Bed Bath & Beyond's Intrinsic Value: DCF (Earnings Based) or its related term are showing as below:
During the past 13 years, the highest Price-to-Intrinsic-Value-DCF (Earnings Based) Ratio of Bed Bath & Beyond was 0.51. The lowest was 0.27. And the median was 0.28.
The historical data trend for Bed Bath & Beyond's Intrinsic Value: DCF (Earnings Based) can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Bed Bath & Beyond Annual Data | |||||||||||||||||||||
Trend | Feb14 | Feb15 | Feb16 | Feb17 | Feb18 | Feb19 | Feb20 | Feb21 | Feb22 | Feb23 | |||||||||||
Intrinsic Value: DCF (Earnings Based) | Get a 7-Day Free Trial | - | - | - | - | - |
Bed Bath & Beyond Quarterly Data | ||||||||||||||||||||
May18 | Aug18 | Nov18 | Feb19 | May19 | Aug19 | Nov19 | Feb20 | May20 | Aug20 | Nov20 | Feb21 | May21 | Aug21 | Nov21 | Feb22 | May22 | Aug22 | Nov22 | Feb23 | |
Intrinsic Value: DCF (Earnings Based) | Get a 7-Day Free Trial | - | - | - | - | - |
For the Specialty Retail subindustry, Bed Bath & Beyond's Price-to-DCF (Earnings Based), along with its competitors' market caps and Price-to-DCF (Earnings Based) data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
For the Retail - Cyclical industry and Consumer Cyclical sector, Bed Bath & Beyond's Price-to-DCF (Earnings Based) distribution charts can be found below:
* The bar in red indicates where Bed Bath & Beyond's Price-to-DCF (Earnings Based) falls into.
This is the intrinsic value calculated from the Discounted Earnings model with default parameters. The calculation method is the same as Discounted Cash Flow model except earnings are used in the calculation instead of free cash flow. This is the default method of calculation with GuruFocus DCF calculator.
Usually a two-stage model is used in calculating the intrinsic value with discounted cash flow model. The first stage is called growth stage; the second is called the terminal stage. In the growth stage the company grows at a faster rate. Because it cannot grow at that rate forever, a lower rate is used for the terminal stage.
GuruFocus DCF calculator is a two-stage model. The default values are defined as:
1. Discount Rate: d = 11%
A reasonable discount rate assumption should be at least the long term average return of the stock market, which can be estimated from risk free rate plus risk premium of stock market. GuruFocus uses 10-Year Treasury Constant Maturity Rate as the risk-free rate and rounded up to the nearest integer. It is updated daily. The current risk-free rate is 4.66%. Please go to Economic Indicators page for more information. Please note that we use the 10-Year Treasury Constant Maturity Rate of the country/region where the company is headquartered. If the data for that country/region is not available, then we will use the 10-Year Treasury Constant Maturity Rate of the United States as default. Then we added a risk premium of 6% to get the estimated discount rate. Some investors use their expected rate of return, which is also reasonable. A typical discount rate can be anywhere between 6% - 20%.
2. Growth Rate in the growth stage: g1 = 5%
The Growth Rate in the growth stage is initially set as the default 10-Year EPS without NRI Growth Rate. In cases where the 10-year growth rate is unavailable, it defaults to using the 5-Year EPS without NRI Growth Rate. If both the 10-year and 5-year growth rates are unavailable, the system defaults to the 3-Year EPS without NRI Growth Rate.
However, it's important to note that there is a growth rate range. If the calculated growth rate exceeds 20%, it will be capped at 20%. Conversely, if the calculated growth rate falls below 5%, it will be adjusted to 5% to maintain a reasonable range.
=>
Bed Bath & Beyond's average EPS without NRI Growth Rate in the past
3 years was -99.80%,
which is less than 5%. GuruFocus defaults => Growth Rate: 5%
3. Years of Growth Stage: y1 = 10
4. Terminal Growth Rate: g2 = 4%
5. Years of Terminal Growth: y2 = 10
6. EPS without NRI: eps without nri = $-19.660.
GuruFocus DCF calculator is actually a Discounted Earnings calculator, EPS without NRI is used as the default. The reason we are doing this is we found that historically stock prices are more correlated with earnings than free cash flow.
All of the default settings can be changed and the results are calculated automatically.
Bed Bath & Beyond's Intrinsic Value: DCF (Earnings Based) for today is calculated as:
Intrinsic Value: DCF (Earnings Based) | = | EPS without NRI | * | {[(1+g1)/(1+d) | + | (1+g1)^2/(1+d)^2 | + | ... | + | (1+g1)^10/(1+d)^10] |
+ | (1+g1)^10/(1+d)^10 | * | [(1+g2)/(1+d) | + | (1+g2)^2/(1+d)^2 | + | ... | + | (1+g2)^10/(1+d)^10]} |
set x = (1+g1)/(1+d) = (1+0.05)/(1+0.11) = 0.94594594594595
and y = (1+g2)/(1+d) = (1+0.04)/(1+0.11) = 0.93693693693694
Intrinsic Value: DCF (Earnings Based) | = | EPS without NRI | * | {[x | + | x^2 | + | ... | + | x^10] | + | x^10 | * | [y | + | y^2 | + | ... | + | y^10]} |
= | EPS without NRI | * | [x | * | (1-x^10) | / | (1-x) | + | x^10 | * | y | * | (1-y^10) | / | (1-y)] | |||||
= | -19.660 | * | 11.5406 | |||||||||||||||||
= | -226.89 |
Margin of Safety % (DCF Earnings Based) | = | (Intrinsic Value: DCF (Earnings Based) | - | Current Price) | / | Intrinsic Value: DCF (Earnings Based) |
= | (-226.89 | - | 0.0789) | / | -226.89 | |
= | N/A |
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Bed Bath & Beyond (OTCPK:BBBYQ) Intrinsic Value: DCF (Earnings Based) Explanation
Unlike valuation methods such as Net Current Asset Value, Tangible Book Value per Share, Graham Number, Median Ratio etc, discounted Cash Flow model evaluates the companies based on their future earnings power instead of their assets.
Be Aware
What you need to know about Discounted Earnings model:
1. The Discounted Earnings model evaluates a company based on its future earnings powerYou can screen for stocks that trade below their Intrinsic Value: DCF (FCF Based) and Intrinsic Value: DCF (Earnings Based) with the GuruFocus All-in-One Screener. Companies with a high Predictability Rank that trade at a discount to their Intrinsic Value: DCF (FCF Based) and Intrinsic Value: DCF (Earnings Based) can be found in the screen of Undervalued Predictable Companies.
Thank you for viewing the detailed overview of Bed Bath & Beyond's Intrinsic Value: DCF (Earnings Based) provided by GuruFocus.com. Please click on the following links to see related term pages.
Carol Flaton | director | 1001 LOUISIANA STREET, HOUSTON TX 77002 |
Scott Lindblom | officer: EVP, Chief Tech & Digital OFC | 650 LIBERTY AVENUE, UNION NJ 07083 |
Patty Wu | officer: EVP, BRAND PRESIDENT | 650 LIBERTY AVENUE, UNION NJ 07083 |
Hobart Sichel | officer: EVP,CHF MARKET'G&CUSTOMER OFC | 1830 ROUTE 130 NORTH, BURLINGTON NJ 08016 |
David Kastin | officer: EVP, CHIEF LEGAL OFFICER | C/O VITAMIN SHOPPE, INC., SECAUCUS NJ 07094 |
Gustavo Arnal | officer: EVP, CFO | C/O AVON PRODUCTS, INC., 1 AVON PLACE, SUFFERN NY 10901 |
Rc Ventures Llc | 10 percent owner, other: See Footnote 1 | PO BOX 25250, PMB 30427, MIAMI FL 33102 |
Ryan Cohen | 10 percent owner, other: See Footnote 1 | C/O OLSHAN FROME WOLOSKY LLP, 1325 AVENUE OF THE AMERICAS, NEW YORK NY 10019 |
Andrea Weiss | director | 23 RAMRAPO COURT WEST, GLENROCK NJ 07452 |
Laura Crossen | officer: SVP, CHIEF ACCOUNTING OFFICER | C/O BED BATH & BEYOND INC., 650 LIBERTY AVENUE, UNION NJ 07083 |
Mara Sirhal | officer: EVP, CHIEF MERCHANDISING OFC | C/O BED BATH & BEYOND INC., 650 LIBERTY AVENUE, UNION NJ 07083 |
Harriet Edelman | director | |
Jeff Kirwan | director | TWO FOLSOM STREET, SAN FRANCISCO CA 94105 |
Sue Gove | director, officer: INTERIM CEO | 901 WEST WALNUT HILL LANE, MAIL STATION 6B-3, IRVING TX 75038 |
Mark J Tritton | director, officer: PRESIDENT AND CEO | TARGET CORPORATION, 1000 NICOLLET MALL, MINNEAPOLIS MN 55403 |
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