Bed Bath & Beyond shares jump more than 60% as message board mentions soar on the troubled, heavily shorted stock

Bed Bath & Beyond shares jump more than 60% as message board mentions soar on the troubled, heavily shorted stock

A view of a Bed Bath and Beyond store in Daly City, California.

Justin Sullivan | Getty Images

Shares of Bed Bath & Beyond jumped more than 60% on Monday as meme traders seemed to be betting on the stock despite any apparent catalyst for the move.

The heavily shorted stock, which has tumbled more than 44% this year, was the most searched name on Reddit’s WallStreetBets discussion board on Monday, according to Quiver Quantitative. Users under a pinned thread titled “GME, BBBY and AMC Memestock Megathread for Monday August 8th, 2022” appeared to be buying up shares of the retail stock.

One user said they “took out a 27k loan, went all in on BBY,” which a group moderator seemed to confirm. Another user (TheDude0007) alleged to have capitalized on the BBBY spike, turning $45,000 into almost $450,000 using common stock and call options.

Bed Bath & Beyond has been a part of the meme stock craze that has hit Wall Street in recent years and driven names such as GameStop and AMC Entertainment higher as investors bought up shares and forced short sellers to attempt to cover their losses, creating what’s known as a “short squeeze.” According to data from FactSet, a whopping 46% of the stock’s float is sold short.

As many retailers cope with inflation-wary consumers and excess inventory, Bed Bath & Beyond has struggled to reverse declining sales, fix its merchandising strategy and gain back customers who have fled to its competitors. It’s also been searching for a new leader after the board announced in late June that CEO Mark Tritton had left the company.

At the same time, the Union, New Jersey-based home goods retailer has also been burning through cash as its net losses grow. While the company has not provided a forecast, it said it expects same-store sales trends to improve after plummeting 24% year over year in the quarter ended May 28.

Shares of GameStop and AMC rose more than 9% and 14%, respectively, on Monday.

— CNBC’s Melissa Repko and Jack Stebbins contributed reporting.

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