What happened
Shares of meme stock Bed Bath and Beyond (BBBY) were surging again today as rumors swirled ahead of the company's strategic update Wednesday morning.
The stock finished the day up 24.8%.
So what
Bed Bath and Beyond stock has been on a roller-coaster ride over the past month as traders from Reddit's WallStreetBets executed a short squeeze on the retail stock, which had 103% of its float sold short as of a month ago.
However, much of the air in that rally, which had carried the stock up as much as 750% in just a few weeks, went out when Chewy co-Founder Ryan Cohen sold his entire stake in the home furnishings retailer two weeks ago.
Today, traders were building a momentum for a new rally with Wednesday's strategic update, which it announced last Thursday, serving as the catalyst.
Speculation has mounted since then with traders on WallStreetBets guessing that the update could mean a sale of Buy Buy Baby, while others observed that Bed Bath and Beyond shares have become hard to borrow, a sign that another short squeeze could be in the making. Meanwhile, a significant number of posters on the message board continue to call for the stock to go to the moon, urging on another rally.
Meanwhile, media reports indicate that the company is close to securing $400 million in financing, which would be a shot in the arm for a retailer with shrinking liquidity. The company is struggling in the current consumer environment as spending shifts away from home goods after the category spiked during the pandemic.
Now what
Investors already know from last year's boom in stocks like GameStop and AMC Entertainment that meme stocks don't die easily, so it's not surprising to see Bed Bath and Beyond soaring again. It also appears that the stock remains heavily shorted, which could help fuel another rally.
Either way, expect Wednesday to be another wild day for the stock as investors are sure to have a strong reaction to whatever the news is in the strategic update.
