S&P lowers At Home Group

S&P said it downgraded At Home Group Inc. to B from B+ on lower-than-expected performance and continuing performance pressure.

“We expect heightened competition and tariffs will continue to strain operating performance over the next 12 months. At Home meaningfully revised down its comparable-sales guidance for the full year (roughly 180 basis points [bps] at the midpoint), primarily because of competitors’ aggressive promotions in Christmas décor that hurt sales in the category,” S&P said in a press release.

S&P believes that Walmart, Target and others are fighting actively for a larger share of the market. “In its third-quarter earnings call, At Home noted that competitors improved their Christmas merchandise offerings from last season, which to us further indicates that home décor is an increasing focus for competitors. We believe heightened competition, and project roughly flat to slightly negative same-store sales in fiscal 2021,” S&P said.

The outlook is negative.

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