Big Lots, Inc. (BIG) | Investment Case

1. Company Snapshot

1.a. Company Description

Big 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, case goods, and ready-to-assemble departments; seasonal category, which comprises patio furniture, gazebos, Christmas trim, and other holiday departments; soft home category that consists of fashion and utility bedding, bath, window, decorative textile, home organization, area rugs, home décor, and frames departments; and food category that includes beverage and grocery, candy and snacks, specialty foods, and pet departments.It also provides merchandise under the consumables category, which comprises health, beauty and cosmetics, plastics, paper, and chemical departments; hard home category, including small appliances, tabletops, and food preparation and stationery products; home maintenance and organization products; toys; and accessories category consisting of apparel, electronics, jewelry, apparel, and hosiery departments.

As of January 29, 2022, it operated 1,431 stores in 47 states and an e-commerce platform.Big Lots, Inc.was founded in 1967 and is headquartered in Columbus, Ohio.

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1.b. Last Insights on BIG

Big Lots' recent performance was negatively driven by reports of the company considering bankruptcy and seeking investors to avoid filing for Chapter 11 protections. The company's weak sales and several quarters of losses led to a decline in its business condition. Additionally, the company's decision to postpone its earnings release and eventually file for bankruptcy further contributed to the negative sentiment.

1.c. Company Highlights

Last Price	0.5
Change Percentage	9.11%
Open	0.46
Previous Close	0.46
Market Cap ( Millions)	15
Volume	8761673
Year High	8.41
Year Low	0.4
M A 50	1.07
M A 200	3.74

FCF Yield	-910218.42%
Dividend Yield	0.00%
ROE	1212.39%
Debt / Equity	-1516.29%
Net Debt / EBIDTA	-657.98%
Price To Book	-0.0
Price Earnings Ratio	-0.0
Price To FCF	-0.0
Price To sales	0.0
EV / EBITDA	-6.58

2. Transcript Summary

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3. NewsRoom

Big Lots! Grand Opening Celebration This Thursday October 30 with Giveaways, Raffles, and Doorbusters

Oct -29

Source: businesswire.com

Big Lots! Announces Grand Opening Celebration Across All Stores Thursday, October 30

Oct -02

Source: businesswire.com

Big Lots, Inc. (BIG) Q4 2022 Earnings Call Transcript

Sep -22

Source: seekingalpha.com

Big Lots was ‘too expensive' — the discounter's new owner says

May -15

Source: nypost.com

Big Lots to reopen more than 100 shuttered stores after bankruptcy filing

Apr -29

Source: nypost.com

Big Lots stores reopening update: Here's the full list of locations that will open this week

Apr -29

Source: fastcompany.com

Big Lots! Stores to Open Under New Ownership, Variety Wholesalers Delivering Unbeatable Bargains to Shoppers

Apr -04

Source: businesswire.com

Ollie's Bargain Outlet Acquires 40 Former Big Lots Stores from Gordon Brothers

Feb -27

Source: globenewswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (4.80%)

6. Segments

Furniture

Expected Growth: 4.83%

Big Lots, Inc.'s furniture segment growth of 4.83% is driven by increasing demand for affordable home furnishings, successful implementation of the 'Retail 2.0' strategy, and expansion of the e-commerce platform. Additionally, the company's focus on private label brands, such as Broyhill and Norma Jean, has contributed to the growth.

Consumables

Expected Growth: 4.65%

Big Lots, Inc.'s Consumables segment growth of 4.65% is driven by increasing demand for everyday essentials, strategic pricing, and effective inventory management. Additionally, the company's focus on private label products, loyalty programs, and omnichannel presence have contributed to the growth.

Seasonal

Expected Growth: 4.83%

Big Lots, Inc.'s 4.83% seasonal growth is driven by increased demand for home decor and furniture during holidays and summer seasons, as well as strategic pricing and inventory management. Additionally, the company's focus on omnichannel retailing and e-commerce expansion has contributed to the growth.

Soft Home

Expected Growth: 4.83%

Soft Home from Big Lots, Inc. growth of 4.83% driven by increasing demand for affordable home furnishings, strategic pricing, and effective inventory management. Additionally, the company's focus on e-commerce expansion, loyalty programs, and targeted marketing efforts have contributed to the segment's growth.

Food

Expected Growth: 4.83%

Big Lots, Inc.'s 4.83% growth in Food segment is driven by increasing demand for affordable groceries, strategic pricing, and effective inventory management. Additionally, the company's focus on private label products, convenient store formats, and targeted marketing campaigns have contributed to the growth.

Hard Home and Other

Expected Growth: 4.83%

Big Lots' Hard Home and Other segments' 4.83% growth is driven by strategic pricing, improved inventory management, and enhanced customer experience. Additionally, the company's focus on e-commerce expansion, loyalty programs, and targeted marketing initiatives have contributed to the growth. Furthermore, the segment has benefited from the ongoing trend of consumers seeking value and convenience, leading to increased sales in the hard home goods category.

7. Detailed Products

Furniture

Big Lots offers a wide range of furniture for the home, including sofas, loveseats, chairs, tables, desks, beds, mattresses, and more.

Mattresses

Big Lots carries a variety of mattresses from top brands, including Serta, Sealy, and more.

Home Decor

Big Lots offers a wide selection of home decor items, including rugs, curtains, wall art, and decorative accessories.

Kitchen and Dining

Big Lots sells a variety of kitchen and dining essentials, including cookware, dinnerware, and small appliances.

Bed and Bath

Big Lots offers a range of bed and bath products, including bedding, towels, and bathroom accessories.

Seasonal and Outdoor

Big Lots sells seasonal items, such as patio furniture, outdoor decor, and holiday decorations.

Food and Beverage

Big Lots offers a limited selection of food and beverage items, including snacks, beverages, and specialty foods.

Health and Beauty

Big Lots sells a limited selection of health and beauty products, including personal care items and wellness products.

8. Big Lots, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Big Lots, Inc. faces moderate threat from substitutes due to the availability of alternative products from online retailers and other discount stores.

Bargaining Power Of Customers

Big Lots, Inc. has a low bargaining power of customers due to its focus on providing low prices and a wide range of products, making it difficult for customers to negotiate prices.

Bargaining Power Of Suppliers

Big Lots, Inc. has a moderate bargaining power of suppliers due to its reliance on a few large suppliers, but it also has some negotiating power due to its large scale of operations.

Threat Of New Entrants

Big Lots, Inc. faces a low threat of new entrants due to the high barriers to entry in the discount retail industry, including the need for significant capital investment and established supply chains.

Intensity Of Rivalry

Big Lots, Inc. operates in a highly competitive industry with many established players, leading to a high intensity of rivalry among competitors.

9. SWOT Analysis

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

	Value
Debt Weight	69.74%
Debt Cost	3.95%
Equity Weight	30.26%
Equity Cost	15.76%
WACC	7.52%
Leverage	230.43%

11. Quality Control: Big Lots, Inc. passed 1 out of 9 key points

Strong Liquidity

Low Deb

Strong Interest Coverage

Healthy Cash Flow

Operating Efficiency

Strong Return On Equity

Consistent Revenue Growth

Consistent Operating Cash Flow Growth

Margin Improvement

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Nu Skin

A-Score: 5.9/10

Value: 8.5

Growth: 2.2

Quality: 6.4

Yield: 5.0

Momentum: 10.0

Volatility: 3.0

1-Year Total Return ->

Vita Coco

A-Score: 5.2/10

Value: 1.6

Growth: 7.7

Quality: 7.8

Yield: 0.0

Momentum: 9.5

Volatility: 4.7

1-Year Total Return ->

B&G Foods

A-Score: 4.8/10

Value: 9.6

Growth: 2.6

Quality: 2.8

Yield: 10.0

Momentum: 0.0

Volatility: 3.7

1-Year Total Return ->

Big Lots

A-Score: 4.1/10

Value: 10.0

Growth: 1.4

Quality: 5.9

Yield: 2.0

Momentum: 5.0

Volatility: 0.3

1-Year Total Return ->

Duckhorn Portfolio

A-Score: 4.0/10

Value: 2.7

Growth: 4.1

Quality: 6.1

Yield: 0.0

Momentum: 7.0

Volatility: 4.0

1-Year Total Return ->

MGP Ingredients

A-Score: 3.8/10

Value: 6.9

Growth: 5.0

Quality: 3.2

Yield: 2.0

Momentum: 0.0

Volatility: 5.7

1-Year Total Return ->

Peers Metrics

12.e Scoring ^Insights

12.f DCF ^BETA

Parameters

Short Term Growth

15.70%

Short term Time

10.0

Long-Term Growth

2.00%

WACC

7.52%

Big Lots, Inc. - US0893021032

1. Company Snapshot

1.a. Company Description

1.b. Last Insights on BIG

1.c. Company Highlights

Lower Growth

Cheaper

More Volatile

Earnings Miss

Revenues Miss

Weak Momentum

Earnings Beats

2. Transcript Summary

3. NewsRoom

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (4.80%)

6. Segments

Furniture

Expected Growth: 4.83%

Consumables

Expected Growth: 4.65%

Seasonal

Expected Growth: 4.83%

Soft Home

Expected Growth: 4.83%

Food

Expected Growth: 4.83%

Hard Home and Other

Expected Growth: 4.83%

7. Detailed Products

Furniture

Mattresses

Home Decor

Kitchen and Dining

Bed and Bath

Seasonal and Outdoor

Food and Beverage

Health and Beauty

8. Big Lots, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Bargaining Power Of Customers

Bargaining Power Of Suppliers

Threat Of New Entrants

Intensity Of Rivalry

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

11. Quality Control: Big Lots, Inc. passed 1 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

0.5$

Current Price

0.5$

Potential

-0.00%

Expected Cash-Flows

12.e Scoring ^Insights

12.f DCF ^BETA