Revenue fell 27% year over year in the second quarter to land at $1.43 billion, and the company posted a loss of $366 million in the period. Bear case: There's a very real risk of bankruptcyīed Bath & Beyond's business is in dire straits. The beaten-down stock continues to look very high risk, but there are scenarios that could cause shares to soar above current pricing levels. Roughly 39% of the beleaguered retailer's float is currently sold short, and moderately good news for the business (or other factors) could cause short sellers to cover their positions in order to avoid losses - sending the stock higher in the process.īed Bath & Beyond's business is in rough shape, but there's very little expectation for recovery priced into its valuation, and high short interest on the stock potentially leaves the door open for another short squeeze. Even if new short squeezes or bouts of meme momentum weren't on the same level as what occurred in 2021, it's possible that these catalysts could spur big gains for the company's share price. With that kind of basement-level valuation, even some very mild good news could be capable of powering a significant rally for the stock.īed Bath & Beyond also continues to have high short interest, and it's possible that another short squeeze could drive gains for the stock. Even more staggering, the retailer is valued at less than 8% of this year's expected sales.
Sell-offs have pushed Bed Bath & Beyond's market capitalization down to roughly $487 million. Bull case: The valuation could leave room for upside Is the troubled retailer's stock due for another resurgence, or is this a case where meme momentum has worn off for good and poor financials leave little room for a valuation comeback? Read on for a look at bullish and bearish factors that could shape where the stock heads next. The company's share price is now down roughly 58% across 2022's trading and 88% from the high that it hit early last year.
While the company's business was struggling, investors poured into its stock, hoping to trigger a massive short squeeze or benefit from other positive pricing catalysts.įor those who bought or held shares after the initial pricing pop, it hasn't exactly worked out that way. Bed Bath & Beyond's ( BBBY -5.96%) valuation soared early in 2021 after it became one of a handful of popular meme stocks.
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