NEW YORK, Jan 9 (Portal) – Shares of Bed, Bath & Beyond Inc (BBBY.O) rebounded sharply in bulk trading on Monday after retail investors speculated that the ailing homewares seller could be a potential takeover target.
The company’s shares were last up 35% to $1.77 and were on track for their biggest one-day percentage gain since August 8.
As of midday, traders had exchanged $114 million worth of Bed, Bath & Beyond stock, almost equal to the company’s entire market value of $157 million, according to Refinitiv data.
Online retail stock forums, including Reddit, have been raving about a possible M&A deal, fueling a buying frenzy reminiscent of the “meme stock” phenomenon of 2020, in which stocks of troubled companies like GameStop Corp (GME. N) and AMC Entertainment Holdings (AMC.N) rose amid viral interest on forums like WallStreetBets.
Bed, Bath & Beyond shares lost nearly half their value last Thursday and Friday after the company warned it may not be able to continue as a business and may have to seek relief through bankruptcy.
Portal also reported on Thursday that the company is preparing to file for bankruptcy protection in the coming weeks.
Bed Bath & Beyond has struggled for years with falling sales as it competes with Amazon (AMZN.O) and other peers, with investors pointing to problems including overloaded stores and an over-reliance on discount coupons. Its shares fell 83% in 2022.
In a filing last week, Bed Bath & Beyond said it expects to report a net loss of $385.8 million for its fiscal quarter ended November, including a $100 million impairment charge. The company is expected to announce its results early Tuesday.
Of the 13 analysts covering the company, three have a “hold” recommendation, eight have a “sell” rating, and two have “strong sell” recommendations. The median price target is $2, down from $3 a month ago.
Reporting by Stephen Culp in New York; Additional reporting by Noel Randewich in Oakland, California; Editing by Alison Williams
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