BIG - Big Lots slides after JPMorgan is negative on post-pandemic setup

JPMorgan downgraded Big Lots (NYSE:BIG) to an Underweight rating after having it slotted at Neutral. The ratings cut was made after JPMorgan sized up the retailer's positioning amid market share shifts, inflation and promotional activity. Analyst Matthew Boss: "With more than 60% of BIG’s assortment tied to Home-related categories (notable pandemic & stimulus beneficiaries), $670B of fiscal aid in 2020/21 in the rearview, mounting inflationary pressures impacting BIG’s core low-end consumer & the P/L (DC labor, wage investments, and freight/transportation), & potential margin erosion tied to a return of markdowns – we see potential downside risk to estimates." The firm lowered the December 2022 price target on Big Lots (BIG) to $31 based on 2X the 2023 EBITDA estimate or 6X the 2023 EPS estimate. The 2X discount is called suitable given BIG’s historical inconsistency on top line and bottom line performance, as well as the macro/micro risk tied to

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Big Lots slides after JPMorgan is negative on post-pandemic setup