Discount retail chain Big Lots (BIGGQ) is preparing for the end with plans to start Going Out of Business (GOB) sales at its stores in the coming days. This comes after the company failed to secure an asset purchase agreement with Nexus Capital Management during its bankruptcy. However, Big Lots intends to work toward a going concern agreement with Nexus Capital or another financer as it conducts GOB sales.
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Big Lots CEO Bruce Thorn hopes a going concern sale will materialize despite its GOB plans. Even so, the company made the difficult decision to start the GOB process “to protect the value of the Big Lots estate.”Customers looking to take advantage of the GOB sale can do so at its physical retail locations and online. Big Lots will continue to assist and serve customers with orders in-store and through its website.
How This Affects BIGGQ Stock
Investors in Big Lots, or what remains of them, aren’t taking today’s news well. Shares of BIGGQ closed out trading yesterday down 21.57% alongside the GOB sale news, leaving them at just 8 cents each. Additionally, the stock is down 98.97% year-to-date.
Investors will note that Big Lots shares currently trade on the OTC Markets. They were previously listed on the New York Stock Exchange (NYSE) but had to switch to the OTC Markets alongside the company’s bankruptcy filing.
What’s Next for Big Lots?
The future looks grim for Big Lots with today’s GOB sale announcement and failure to secure an asset sale agreement. While the company continues to pursue a going concern transaction, that doesn’t seem likely. Another factor to consider is the timeframe for such a deal. Big Lots says its goal would be securing an agreement by early January 2025. Considering it’s late December, this may be a sign there’s not much steam left in the discount retailer.
No analysts have offered coverage of Big Lots over the last three months. That’s to be expected with how risky BIGGQ shares have become since it filed for bankruptcy. While some risk-averse traders might use the news to buy those shares for cheap, the unlikely return on that investment makes it inadvisable.
Instead, traders might consider a stake in a less risky retail stock, such as Walmart (WMT). A few options worth comparing are below.
