BIG - Big Lots Stock: Expect Big Pain After Big Gains

2024-05-15 09:16:38 ET

Summary

• Big Lots shares have plunged 91.1% since August 2021, driven by top line and bottom-line deterioration due to inflationary pressures.
• The company's revenue has declined from $6.15 billion in 2021 to $4.72 billion in 2023, with significant drops in comparable store sales.
• The company's net debt has increased from negative $50.2 million in 2021 to $359.9 million in 2023, and its book value has dropped to $284.5 million.
• The recent surge in BIG stock price is unlikely to last unless something big happens, and investors should tread cautiously.

Historically speaking, my investment calls usually turn out quite well. But just like every other investor in the world, I am not without mistakes. One of the biggest that I have made over the past few years involves the home discount retailer known as Big Lots, Inc. ( BIG ). The last article that I wrote about the company was published in August 2021. In that article, citing financial performance figures and how cheap shares were, I ended up rating the company a "Strong Buy" to reflect my view that shares would be likely to outperform the broader market for the foreseeable future by a rather significant margin....

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