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First Time took a look at Bed, Bath & Beyond (BBBY), now Barron's comes out with a very favorable article on BBBY.

Shares of home-furnishings giant Bed Bath & Beyond have climbed 11% in the past year, outpacing those of retailers Target , Wal-Mart and JCPenney , each of which is down at least 10%.

Still, investors would be foolish to bail out of Bed Bath now. The stock, which last week was at 31 and change, could climb nearly 25% in the next year, according to some savvy investors.

That is because even in this lousy economy, Bed Bath (ticker: BBBY) is boosting its store base and earnings. Meanwhile, some competitors have gone belly-up, most notably Linens 'N Things, which began liquidating its 500-plus stores late last year. A shake-out of the competitive landscape bodes well for Bed Bath longer-term, as it picks up market share.

"This is a high-quality company with lots of financial flexibility," says David Fording, co-manager of the William Blair Growth Fund (WBGSX), which has held the stock since late last year, when it was around 25. He figures the shares are worth close to 40.

The shares are inches away from a new 52-week high.

Posted by edelfenbein at July 20, 2009 10:51 AM