Shares of Big Lots Inc. (BIG) surged 9.77% during Friday’s trading session, defying the broader market trend. This upward movement came after the company announced a postponement of its second-quarter fiscal 2024 financial results, originally scheduled for the same day. The company now plans to release these results on September 12.
This unexpected delay follows reports that Big Lots is exploring potential bankruptcy options due to declining sales. According to Bloomberg, the discount home goods retailer is actively seeking investors to prevent a Chapter 11 filing, although no definitive decisions have been made. Despite the uncertainty surrounding its financial future, Big Lots ended the first quarter with a healthy $289 million in liquidity, including $44 million in cash and $573.8 million in long-term debt.
Analyst consensus estimates project Big Lots to report an EPS loss of $3.46 on revenue of $1.044 billion.
The news of a potential bankruptcy sent shockwaves through the market, causing Big Lots shares to plummet in late August. However, the company’s recent announcement and the revelation of its financial position have ignited a glimmer of hope for investors.
For those interested in participating in the market for Big Lots, whether to purchase shares or take a bearish stance, the process typically involves a brokerage account. You can find a list of potential trading platforms online, many of which allow for fractional share purchases. This feature enables investors to own portions of stock without acquiring an entire share, a particularly useful option for expensive stocks like Berkshire Hathaway. In the case of Big Lots, currently trading at $0.50, $100 would allow you to purchase 200 shares.
Taking a bearish position on a company, known as short selling, is a more intricate process. It requires access to an options trading platform or a broker who allows short selling. Short selling involves borrowing shares to sell, hoping to repurchase them at a lower price later and profit from the price difference. You can find detailed information on short selling resources online. Alternatively, if your broker supports options trading, you can choose to buy a put option or sell a call option at a strike price above the current share price. Both strategies allow you to profit from a decline in the share price.
It’s crucial to remember that investing carries inherent risks, and past performance is not indicative of future returns. Always consult with a financial advisor before making investment decisions and conduct thorough research before investing in any company.
