Meme stock Bed Bath & Beyond’s rally rages on
2022.08.16 20:02
Budrigannews.com – Shares of Bed Bath & Beyond Inc (NASDAQ:BBBY) surged 60% to a near five-month high in volatile trading on Tuesday, as retail investors continued to drive up the highly shorted stock’s price.
Bed Bath & Beyond, which has 50.7% of its public free float in short position, has triggered a short squeeze signal, according to analytics firm Ortex.
A short squeeze occurs when a surge in price of an asset forces bearish investors to buy back shares at a higher price to limit losses, in turn driving demand and pushing the price even higher.
The home furnishing company’s shares were the most traded on brokerage Fidelity’s platform, indicating interest from individual investors.
The stock rose as much as 78.8% to $28.60 during the session and trading was halted multiple times for volatility. About 189 million shares changed hands by 11:47 a.m. ET, more than six times the firm’s 30-day moving average volume.
The stock is up 440% so far this month in a rally that evocative of eye-watering gains in shares of GameStop (NYSE:GME) and AMC Entertainment (NYSE:AMC) early last year that hurt hedge funds that had bet against the stock.
Bed Bath & Beyond opened lower after B. Riley downgraded the stock to “sell”, saying the shares are trading at “unrealistic valuations.”
Another highly shorted stock, meal-kit delivery firm Blue Apron, jumped nearly 20% to $5.50.
