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Bed Bath & Beyond Shares Climb 7% On Analyst Upgrade

Shares of Bed Bath & Beyond Inc. (BBBY) are up 7% after an analyst at Wedbush upgraded the home goods retailer to outperform from neutral.

Wedbush's analyst Seth Basham, in a note to investors, wrote the Union, New Jersey-based company has a "good chance of stabilization" over the next two years as new changes take hold. He raised his stock price target to $16 from $14.

Basham also noted that with earnings report scheduled for Wednesday, the company might name a "well-regarded and highly experienced" CEO.

"While turning around declining retailers is a very difficult task, particularly amidst unfavorable secular trends and soft industry sales growth, we see a good chance of stabilization — if not growth — in earnings over the next two years as sweeping changes take hold," Basham wrote.

CEO Steven Temares had resigned as CEO and also from the board in May. The board had appointed Mary Winston as interim CEO.

The company also recently made several changes to transform itself, including reduction of its corporate staff by 7%, elimination of the role of the chief operating officer, and plans to cut inventory by about $1 billion.

BBBY is currently trading at $10.56, up $0.67 or 6.83%, on the Nasdaq.

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