Bed Bath & Beyond, a favorite with the meme stock crowd that has surged higher this month, jumped nearly 15% on Wednesday after the company reportedly secured a loan deal to shore up its balance sheet.
The stock is up nearly 100% in the last month thanks to an army of retail investors.
Bed Bath & Beyond's stock rebounded from last week's losses as investors cheered a report from The Wall Street Journal that the company has successfully lined up financing to boost cash flow.
According to the Journal, the home goods retailer, which has faced inventory struggles and declining sales, had been seeking around $375 million to boost its cash levels and pay down existing debt, but final terms of the deal are not yet clear.
The stock of Bed Bath & Beyond was the most popular topic in the WallStreetBets chat room on Wednesday, as retail investors celebrated the news.
Wall Street analysts had warned for months that the retailer was in dire need of new financing due to high cash burn.
As meme-stock traders from social media sites pile into the stock, which at one point was up 300% for the month of August, shares have been skyrocketing this month.
Ryan Cohen, a billionaire activist investor, announced last week that he would be selling his 10% stake in the company.
The retailer's stock is up over 70% this month, but it is still down 39% for the year, more than the S&P 500's decline. After Bed Bath & Beyond's quarterly earnings report in June, the stock rebounded thanks to a boost from meme-stock traders who have driven up the share price.
The majority of Wall Street analysts covering Bed Bath & Beyond have a "sell" rating on the stock, remaining unconvinced about the retailer's ability to revive its struggling business and warning of " unrealistic" share price valuations. While Cohen's purchase of shares helped boost excitement among retail investors, analysts warned that his recent decision to sell his entire stake in the company could hurt Bed Bath & Beyond as it looks to shore up financing.
The investor in Bed Bath & Beyond sold his entire stake.
Bed Bath & Beyond jumped 29% as stock traders snapped up shares despite analyst warnings.
Bed Bath & Beyond Surges as retail traders return to the stock market.
The new CEO of Bed Bath and Beyond bought 50,000 shares.
All Rights Reserved © 2024
