Big Lots (BIGGQ) AI Stock Analysis

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Big Lots

(OTC:BIGGQ)

Rating:29Underperform

Price Target:―

Big Lots' overall stock score is very low due to dire financial performance, negative corporate events including bankruptcy, and poor valuation. Despite some positive technical trends and strategic initiatives, the company's critical challenges overshadow potential improvements.

Big Lots (BIGGQ) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$742.35K

Dividend YieldN/A

Average Volume (3M)20.86K

Price to Earnings (P/E)―

Beta (1Y)5.73

Revenue Growth-9.89%

EPS Growth19.01%

CountryUS

Employees10,000

SectorConsumer Cyclical

Sector Strength64

IndustryDiscount Stores

Share Statistics

EPS (TTM)-15.92

Shares Outstanding29,694,012

10 Day Avg. Volume19,530

30 Day Avg. Volume20,859

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)N/A

Price to Sales (P/S)0.00

P/FCF RatioN/A

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price TargetN/A

Price Target UpsideN/A

Rating ConsensusN/A

Number of Analyst Covering0

Big Lots Business Overview & Revenue Model

Company DescriptionBig Lots, Inc., through its subsidiaries, operates as a home discount retailer in the United States. The company offers products under various merchandising categories, such as furniture category that includes upholstery, mattresses, home décor, case goods, and ready-to-assemble departments; seasonal category, which comprises patio furniture, gazebos, Christmas trim, lawn and garden, and other holiday departments; soft home category consists of apparel, hosiery, jewelry; frames, fashion and utility bedding, bath, window, decorative textiles, and area rugs departments; and food category that includes beverages and grocery, specialty foods, and candy and snacks departments. It also provides merchandise under the consumables category, which comprises health, beauty and cosmetics, plastics, paper, pet, infant, stationery, and chemical departments; and hard home category, including small appliances, tabletops, food preparation products, home maintenance and organization products, toys, electronics departments, and other offerings. Big Lots, Inc. was founded in 1967 and is headquartered in Columbus, Ohio. On September 9, 2024, Big Lots, Inc., along with its affiliates, filed a voluntary petition for reorganization under Chapter 11 in the U.S. Bankruptcy Court for the District of Delaware.

How the Company Makes MoneyBig Lots generates revenue primarily through the sale of merchandise in its physical retail stores and its online platform. The company's key revenue streams include sales from its primary product categories: furniture, seasonal items, food, consumables, and home goods. By purchasing closeouts, overstocks, and other opportunistic deals from manufacturers and distributors, Big Lots can offer customers significant savings. Additionally, the company may form strategic partnerships with manufacturers and vendors to secure exclusive products and special promotions, further enhancing its value proposition. Big Lots also focuses on optimizing its supply chain and inventory management to maintain cost efficiency and maximize profitability.

Big Lots Earnings Call Summary

Earnings Call Date:Feb 27, 2025

(Q3-2024)

% Change Since: 0.00%|

Next Earnings Date:May 23, 2025

Earnings Call Sentiment Positive

The call highlighted several key improvements, including sequential gains in sales metrics, significant cost savings initiatives, and gross margin improvements. However, the company faced challenges with negative comparable sales, seasonal comps decline, and increased competition in food and consumables. The sentiment is slightly leaning towards positive due to strategic initiatives showing progress.

Q3-2024 Updates

Positive Updates

Sequential Improvement in Key Metrics

Delivered on or exceeded beginning of quarter guidance on all key metrics, showing a sequential improvement in comp sales and a significant year-over-year improvement in gross margin rate.

SG&A Cost Savings

On track to achieve over $100 million of SG&A cost savings for the year prior to Project Springboard, with Project Springboard expected to deliver $200 million of bottom-line opportunities.

Increased Bargain Sales Mix

Mix of bargains, including closeout items, opportunistic buys, and sourced products, accounted for nearly 50% of sales in Q3, exceeding the goal of over 1/3 by the end of the year.

Gross Margin Improvement

Gross margins were up by 240 basis points versus last year, driven by lower freight costs and reduced markdown activity.

Furniture Assortment Recovery

Significant improvement in furniture comps Q4 to-date, attributed to better in-stock levels and new Broyhill items.

Negative Updates

Negative Comparable Sales

Comp sales were down 13.2%, in line with guidance of down low teens, reflecting challenges in consumer spending and competitive pressures.

Seasonal Comps Decline

Seasonal comps declined 15% in Q3, impacted by high promotions from the previous year and oversized seasonal buying.

Challenges in Food and Consumables

Food and consumables categories were impacted by fierce competition, which affected traffic-driving categories where there is less product differentiation.

Increased Interest Expense

Interest expense for the quarter was $13.6 million, up from $6.3 million in the third quarter last year due to higher average amounts drawn on the credit facility and higher interest rates.

Company Guidance

In the recent earnings call for Big Lots, the company reported sequential improvements in key metrics, surpassing their initial guidance for the third quarter. They achieved a 240 basis point increase in gross margin year-over-year, driven by reduced markdowns and lower freight costs. The company's efforts to strengthen their balance sheet and manage costs have resulted in a solid net liquidity position of $258 million. Big Lots is on track to achieve over $100 million in SG&A cost savings for the year, with Project Springboard expected to deliver $200 million in bottom-line opportunities, primarily in 2024. Comp sales were down 13.2%, aligning with guidance, while the mix of bargains reached nearly 50% of sales, exceeding their target. The company anticipates further sequential improvements in the fourth quarter, with a forecasted gross margin rate around 38% and a continued decrease in SG&A expenses.

Big Lots Financial Statement Overview

Summary

Big Lots is facing severe financial distress with declining revenues, negative profitability, and inadequate cash flows. The high leverage and negative equity raise significant concerns about its financial viability.

Income Statement

Negative

Big Lots' income statement shows declining performance with negative net income and EBIT in recent periods, indicating significant profitability challenges. The revenue growth rate is negative, and both gross and net profit margins have deteriorated compared to previous periods, highlighting declining sales efficiency and cost management issues.

Balance Sheet

Very Negative

The balance sheet reveals a concerning financial structure with negative stockholders' equity in the TTM, indicating potential insolvency risks. The debt-to-equity ratio is not meaningful due to negative equity, and the equity ratio has turned negative, suggesting high leverage and weakened financial stability.

Cash Flow

Negative

Cash flow analysis highlights a negative free cash flow in the TTM, with declining operating cash flow and growing capital expenditures. The company struggles to generate positive cash flows from its operations, reflecting significant liquidity challenges and unsustainable cash outflows.

Jan 2024	Jan 2023	Jan 2022	Jan 2021	Jan 2020
Breakdown
Income Statement		Total Revenue
―	―	―	―	―
	Gross Profit
1.69B	1.91B	2.40B	2.50B	2.11B
	EBIT
-387.36M	-261.50M	239.75M	856.55M	334.83M
	EBITDA
-369.75M	-103.71M	384.81M	994.49M	681.76M
	Net Income Common Stockholders
-481.88M	-210.71M	177.78M	629.19M	242.46M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
―	―	―	―	―
	Total Assets
3.33B	3.69B	3.93B	4.04B	3.19B
	Total Debt
2.27B	2.07B	1.82B	1.73B	1.53B
	Net Debt
2.22B	2.02B	1.76B	1.17B	1.47B
	Total Liabilities
3.04B	2.93B	2.92B	2.76B	2.34B
	Stockholders Equity
―	―	―	―	―
Cash Flow		Free Cash Flow
27.61M	-253.19M	34.12M	852.41M	264.51M
	Operating Cash Flow
-251.96M	-144.29M	193.76M	399.35M	338.97M
	Investing Cash Flow
―	―	―	―	―
	Financing Cash Flow
―	―	―	―	―

Big Lots Technical Analysis

Technical Analysis Sentiment

Negative

Last Price0.02

Price Trends

50DMA

0.02

Negative

100DMA

0.06

Negative

200DMA

0.15

Negative

Market Momentum

MACD

>-0.01

Positive

RSI

46.26

Neutral

STOCH

25.00

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BIGGQ, the sentiment is Negative. The current price of 0.02 is below the 20-day moving average (MA) of 0.03, below the 50-day MA of 0.02, and below the 200-day MA of 0.15, indicating a bearish trend. The MACD of >-0.01 indicates Positive momentum. The RSI at 46.26 is Neutral, neither overbought nor oversold. The STOCH value of 25.00 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for BIGGQ.

Big Lots Risk Analysis

Big Lots disclosed 41 risk factors in its most recent earnings report. Big Lots reported the most risks in the "Finance & Corporate" category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Big Lots Peers Comparison

Overall Rating

UnderperformOutperform

Sector (62)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PSMT	79 Outperform	$3.33B	23.07	12.42%	1.12%	8.65%	17.76%
OLLI	78 Outperform	$7.32B	35.64	12.32%	―	8.70%	2.54%
BJ	74 Outperform	$14.67B	25.60	32.76%	―	2.84%	11.25%
DG	69 Neutral	$24.97B	21.64	15.69%	2.08%	4.77%	-23.73%
Sector *	62 Neutral	$6.84B	11.41	2.80%	3.87%	2.70%	-24.58%
DLTR	61 Neutral	$19.72B	―	19.25%	―	-20.46%	-202.26%
BIGGQ	29 Underperform	$742.35K	―	-620.04%	―	-9.89%	19.01%

* Consumer Cyclical Sector Average

Performance Comparison

BIGGQ

Big Lots

0.02

-2.24

-99.12%

Dollar General

113.31

-11.03

-8.87%

DLTR

Dollar Tree

93.85

-15.79

-14.40%

PSMT

Pricesmart

108.35

27.79

34.50%

OLLI

Ollie's Bargain Outlet Holding

115.88

30.68

36.01%

Bj's Wholesale Club Holdings

110.09

21.63

24.45%

Big Lots Corporate Events

M&A TransactionsLegal ProceedingsBusiness Operations and Strategy

Big Lots Strategic Asset Sale and Brand Continuity

Negative

Dec 27, 2024

Big Lots, Inc. announced a strategic sale with Gordon Brothers Retail Partners to transfer assets, including stores and intellectual property, to other retailers like Variety Wholesalers. Variety Wholesalers plans to acquire between 200 and 400 stores and operate them under the Big Lots brand. This agreement aims to preserve jobs and maintain the Big Lots brand’s continuity, pending bankruptcy court approval. The previous agreement with Nexus Capital Management was terminated, leading Big Lots to commence going out of business sales at remaining stores to protect its estate value.

More about Big Lots

Big Lots, Inc. is one of the largest closeout retailers in the United States, focusing on delivering extreme value to customers with a range of products including furniture, décor, and pantry items. The company emphasizes sourcing through closeouts, liquidations, overstocks, private labels, and value-engineered products and is committed to philanthropy through the Big Lots Foundation.

YTD Price Performance: -99.28%

Average Trading Volume: 490,774

Technical Sentiment Consensus Rating: Buy

Current Market Cap: $1.69M

Legal Proceedings

Big Lots Files for Chapter 11 Bankruptcy

Negative

Dec 11, 2024

Big Lots, Inc. and its subsidiaries have filed for Chapter 11 bankruptcy in the United States Bankruptcy Court for the District of Delaware, with joint administration of their cases granted. The company has filed monthly operating reports for September and October, but cautions that these reports are not indicative of future financial results and were prepared solely for bankruptcy court requirements. The company expects common shareholders to face a complete loss on their investments due to the speculative nature of trading during bankruptcy proceedings.

More about Big Lots

YTD Price Performance: -95.88%

Average Trading Volume: 624,975

Technical Sentiment Consensus Rating: Buy

Current Market Cap: $9.53M

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.