Bed Bath & Beyonds BBBY stock skyrocketed more than 50% on Thursday, closing at $5.24, as retail traders pile back into the popular meme stock.
The stock has also seen an increase in short interest throughout the last few monthsas speculation about the companys ability to survive rises.
Recent Bed Bath & Beyond News: Bed Bath & Beyond announced on Tuesday that it will be closing more stores in 2023 as part of a restructuring process to save money. The company also said that it will consider filing for bankruptcy protection.
Third-quarter net sales declined 33% to $1.26 billion over the prior year on $393 million in losses, according to Benzinga Pro.
Bed Bath & Beyonds struggles are not new:the company has lagged behind competitors in online and e-commerce sales for years.
Seeing the stock skyrocket on potential bankruptcy news and poor earnings may seem counterintuitive, but is not unprecedented. Sometimes companies that are on their way out of business see an increase in buying activity among speculative investors. Even the FTX TokenFTT/USD saw a huge rally after the coins parent companyimploded.
Retail Stock Moves: Other popular stocks among retail investors like Gamestop Corp GME and Carvana Co CVNA also moved significantly higher Thursday. A short squeeze is when a stock that has a lot of short interest rapidly increases in price as shorts are forced to cover, causing even more buying and more short covering.
The Last Word:Two weeks ago, Bed Bath and Beyonds stock was at $2.30. Since then, the company announced poor earnings, more store closingsand confirmed that bankruptcy is a possibility. The stock closed higher than $5 Thursday.
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