What made Bed Bath & Beyond shares jump 30% on Thursday?

on Jul 7, 2022
  • SEC filings reveal insiders have been loading up on shares of Bed Bath & Beyond.
  • Brian Sozzi of Yahoo Finance offers his two cents on the news this morning.
  • Wall Street rates BBBY at underweight and sees another 40% downside from here.

Bed Bath & Beyond Inc (NASDAQ: BBBY) is up 30% this afternoon on regulatory filings that revealed insiders have been loading up on shares of the domestic merchandise retailer in recent days.

Interim CEO expands her stake by $230,500

According to the Securities & Exchange Commission, Sue Gove bought 50,000 shares on July 1st – only days after taking over as the Interim CEO. In total, she now has about a $0.6 million stake in BBBY.

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Others that recently bought Bed Bath & Beyond include Jeff Kirwan and Harriet Edelman. The two board members loaded up on 10,000 shares each. BBBY is down nearly 80% for the year.

Generally, investors tend to read insider buying as a sign of confidence in the company’s future. So far, nearly 50 million shares of the retail chain have been traded on Thursday versus the average daily trading volume of 7.0 million only.

Bed Bath & Beyond is facing a liquidity problem

Last week, Bed Bath & Beyond reported its results for the fiscal first quarter that came in significantly below the Wall Street estimates. While the filing does bring some good news for the Nasdaq-listed firm, it does nothing to solve the company’s fundamental problem, as per Brian Sozzi of Yahoo Finance:

Gove has to start alleviating a lot of concerns on Wall Street if this company will even make it to the holiday season; has to raise cash whether that’s debt or share issuance, and start gaining investor support.

Wall Street currently rates BBBY at “underweight” and sees another 40% downside from here. The sell-off this year has shrunk the market capitalisation of Bed Bath & Beyond to under $500 million.

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