Bed Bath & Beyond Inc. (NASDAQ:BBBY)

The analysis of the financial data concerning total assets and adjusted total assets over the six-year period reveals notable trends and shifts.

Total Assets

There is a general pattern of fluctuation in the total assets. The figure starts at approximately 6.85 billion US dollars in early 2017, experiencing a slight increase to about 7.04 billion in 2018. Subsequently, it declines to 6.57 billion in 2019, followed by a significant rise to 7.79 billion in 2020. This increase is not sustained, as there is a moderate decrease to 6.46 billion in 2021 and a further decline to 5.13 billion by 2022. Overall, total assets show volatility with a peak in 2020, then a downward trend over the last two years.

Adjusted Total Assets

Adjusted total assets follow a somewhat similar trend but start at a higher base of approximately 9.35 billion US dollars in 2017. There is a slight increase to about 9.56 billion in 2018, followed by a decline to 8.75 billion in 2019. Unlike total assets, adjusted total assets continue to decline steadily after 2019, dropping to 7.51 billion in 2020 and further decreasing to 6.33 billion in 2021. By 2022, adjusted total assets converge at the same value as total assets, standing at 5.13 billion. This reflects a continual reduction in asset base after 2018, with no reversal in the downward trend.

In summary, both total and adjusted total assets peak around 2018-2020, but adjusted total assets show a more pronounced and steady decrease thereafter. The convergence of the adjusted total assets and total assets values in 2022 suggests a possible re-alignment or reassessment of asset valuation or classification. The asset base contraction in the latter years highlights potential strategic or operational shifts requiring further investigation.

Total liabilities

Over the six-year period, total liabilities exhibited some fluctuation. Starting at approximately 4.13 billion US dollars in February 2017, the figure remained relatively stable through March 2018 and March 2019, with minor decreases observed in 2019. A significant increase occurred in February 2020, reaching over 6 billion US dollars, followed by a notable decline in the subsequent years, ending at just under 5 billion US dollars in February 2022. This indicates a peak in liabilities around early 2020, with a downward adjustment thereafter.

Adjusted total liabilities

The adjusted total liabilities demonstrated a consistent downward trend over the same period. Starting at nearly 6.83 billion US dollars in early 2017, the amount declined steadily each year. From 2017 to 2022, adjusted total liabilities decreased by more than 2.3 billion US dollars, culminating at approximately 4.94 billion US dollars by February 2022. This persistent reduction suggests ongoing efforts to manage or restructure adjusted liabilities systematically across the analyzed years.

Comparative insights

Adjusted total liabilities values were consistently higher than the reported total liabilities across all periods. The gap between these two metrics narrowed over time, mainly due to the sharper decline in adjusted total liabilities compared to relatively more stable total liabilities. The spike in total liabilities observed in February 2020 was not mirrored as prominently in adjusted liabilities, which followed a steady declining path, suggesting differences in accounting or adjustment methodologies impacting reported figures.

Shareholders’ Equity Trend

Shareholders’ equity experienced a general downward trend over the period analyzed. Starting at approximately 2.72 billion US dollars in early 2017, it increased slightly to nearly 2.89 billion in early 2018. After that, it declined consistently each year, dropping significantly to about 176 million US dollars by early 2022. This represents a substantial reduction in equity over the six-year period.

Adjusted Shareholders’ Equity Trend

Adjusted shareholders’ equity follows a similar pattern to shareholders’ equity but with slightly lower values at each point in time. It started at roughly 2.52 billion US dollars in early 2017, increased marginally to around 2.88 billion in early 2018, then steadily decreased in subsequent years. By early 2022, adjusted shareholders’ equity had diminished drastically to approximately 189 million US dollars. The decline highlights a significant erosion in adjusted equity during the period.

Comparative Analysis of Equity Measures

Both shareholders’ equity and adjusted shareholders’ equity exhibit a peak around early 2018 followed by a marked decline. The adjusted shareholders’ equity consistently remains lower than the reported shareholders’ equity, suggesting adjustments that reduce the equity base, possibly related to non-operational factors or revaluations. The overall shrinkage in both equity measures indicates deteriorating financial strength or accumulated losses during the period.

Significance of Equity Decline

The pronounced decline, especially between early 2020 and early 2022, signals increasing financial challenges or significant capital losses. The steep decrease in shareholders' equity could impact the company's solvency, borrowing capacity, and investor perception. The low equity at the end of the period warrants further investigation into the underlying causes, such as operational performance or extraordinary charges.

Total Reported Debt

The total reported debt remained relatively stable between 2017 and 2019, fluctuating slightly around 1.49 billion US dollars. In 2020, the debt increased to approximately 1.59 billion, followed by a notable decrease in 2021 to about 1.19 billion. In 2022, it showed a slight increase again, reaching approximately 1.22 billion US dollars. Overall, the debt exhibited a peak in 2020 before a reduction in the subsequent year.

Shareholders’ Equity

Shareholders’ equity showed a declining trend over the analyzed period. It started at roughly 2.72 billion US dollars in 2017 and peaked slightly higher in 2018 at 2.89 billion. Thereafter, there was a consistent decrease each year, dropping sharply to about 127.7 million in 2021 and further declining to approximately 174 million in 2022. This steep decline indicates a significant erosion of equity capital over the period.

Total Reported Capital

Total reported capital, representing the sum of debt and shareholders' equity, showed a decreasing trend throughout the period. Beginning at about 4.22 billion US dollars in 2017, it decreased steadily to 1.39 billion by 2022. The most significant decline occurred between 2020 and 2021, consistent with the reduction in both debt and equity components.

Adjusted Total Debt

The adjusted total debt figures were considerably higher than the reported debt values and showed a downward trend from 4.20 billion US dollars in 2017 to approximately 3.07 billion in 2022. There was a slight increase noted in 2020 compared to 2019, but the overall trajectory was one of gradual reduction.

Adjusted Shareholders’ Equity

Adjusted shareholders’ equity followed a declining trend, starting at approximately 2.52 billion US dollars in 2017 and decreasing significantly to around 189 million by 2022. A notable drop occurred from 2019 onwards, aligning with the trend seen in reported equity but starting with higher initial values.

Adjusted Total Capital

Adjusted total capital, summing adjusted debt and equity, displayed a continuous decrease from about 6.72 billion US dollars in 2017 to 3.26 billion in 2022. The decline was steady each year, with the largest decreases occurring between 2019 and 2021. This trend reflects the combined impact of reductions in both adjusted debt and equity.

Net Earnings (Loss) Trend

The net earnings showed a declining trend across the analyzed periods. Starting from a positive value of $685,108 thousand in February 2017, net earnings decreased to $424,858 thousand in March 2018. Subsequently, the company experienced a shift to net losses, with losses recorded as $137,224 thousand in March 2019, deepening substantially in February 2020 to $613,816 thousand. The losses slightly improved but remained significant in February 2021 and February 2022, with values of $150,773 thousand and $559,623 thousand, respectively.

Adjusted Net Earnings (Loss) Trend

Adjusted net earnings, which likely exclude certain one-time or non-recurring items, followed a similar declining pattern as reported net earnings. The adjusted earnings began at $717,731 thousand in February 2017, decreasing to $599,016 thousand in March 2018. There was a notable transition to losses beginning in March 2019 amounting to $251,639 thousand, worsening further in February 2020 to $692,234 thousand. In subsequent years, losses were mitigated somewhat in February 2021 at $47,858 thousand but increased again to $430,727 thousand by February 2022.

Overall Insights

The data reveals a significant deterioration in profitability over the six-year span. Both net earnings and adjusted net earnings transitioned from substantial profits to substantial losses, indicating challenges in the firm’s operating environment or business model. Despite some improvement in the adjusted figures for February 2021, the trend shows a return to increased losses by February 2022. The persistent losses suggest ongoing difficulties requiring strategic attention to restore financial health.