Return of the meme stock: Bed Bath & Beyond shares skyrocket

A Bed Bath & Beyond sign is shown in Mountain View, Calif., May 9, 2012. Shares in Bed Bath & Beyond jumped 22% to more than $25 per share Wednesday, Aug. 17, 2022, on huge trading volumes, and the mall-based home goods retailer’s stock has nearly quintupled in a little more than two weeks. If the price holds until the market closes, it will be the fourth straight day it has gained more than 20%. (AP Photo/Paul Sakuma, File)

NEW YORK (AP) — After a quiet first half of 2022, the meme stock is back. Beyond and back, in fact.

Shares in Bed Bath & Beyond soared another 12% Wednesday on huge trading volume, and the mall-based home goods retailer’s stock has quadrupled in a little more than two weeks. For a while on Wednesday, it was on pace to close a fourth straight day with a gain of more than 20%.

The inexplicable recent rise — a hallmark of so-called meme stocks — comes as Bed Bath & Beyond continues to lose money on plummeting sales as it struggles to navigate the post-pandemic retail landscape.

Bed Bath & Beyond fired CEO Mark Tritton in June after the company based in Union, New Jersey, reported a 25% drop-off in sales in its most recent quarter, which followed a 22% sales decline the previous quarter. Tritton, who as CEO of Target revitalized that retailer by introducing a bevy of new brands, laid out a similar plan for Bed Bath & Beyond in 2021, but with far less success.

It's hard to pinpoint why anyone would pour money into a company that's flashing as many warning signs as Bed Beth & Beyond, but it echos the 2021 trend where small investors banded together in online forums like Reddit’s WallStreetBets to stoke a frenzy over certain struggling companies, like GameStop, AMC and Bed Bath & Beyond.

Bed Bath & Beyond shares also skyrocketed in March when the investment firm of billionaire Ryan Cohen took a 10% stake in the company and recommended that it sell all or part of its business. Cohen, a co-founder at Chewy, was at the heart of the GameStop meme saga last year after he took a stake in the struggling video-game retailer.

Cohen built a huge following on Reddit and on social media in 2021 as smaller investors gobbled up meme stocks.

One thread on WallStreetBets Wednesday blared “BED BATH AND BELIEVE," as chatter across the forum focused on how regular people working together can face down professional hedge funds who bet on the stock’s price to fall.

Many of the comments reminisce about GameStop, whose stock kept soaring by stupefying levels for days and seemed headed “to the moon” in January 2021. The stock eventually ran out of momentum and quickly deflated to then bounce around.

“We saw exact same thing happening with GameStop. Why are people so hesitant this time around?” one commenter said about Bed Bath & Beyond, whose ticker symbol is BBBY. “If you wash or even if you lose (which you won’t, BBBY is going BEYOND the moon) at least you won’t regret not hopping in the rocket this time around!”