Retail giant Bed Bath & Beyond (BBBY:NSD) is currently experiencing a massive short-squeeze, with the BBBY stock soaring 230% in just four days. This sudden increase in stock price has caused significant losses for short-sellers who had bet on the decline of the company.
According to data from S3 Partners, short-sellers in the company profited $179 million in 2022, but are now down more than $30 million in 2023. This is due to the recent surge in BBBY stock price, which has caught many investors by surprise.
The cause of this sudden spike in stock price is not entirely clear, but some experts believe that it may be due to speculation surrounding a potential bankruptcy filing. Short-sellers in the company are essentially playing a game of chicken, as they wait to see if the company will file for bankruptcy or if it will be able to turn its fortunes around.
Despite the uncertainty surrounding the company’s future, many investors are still bullish on Bed Bath & Beyond. They believe that the company’s strong brand and loyal customer base will help it weather the current economic downturn. However, others are more skeptical and believe that the company’s financial troubles are too severe for it to recover.
In any case, the next few months will be crucial for Bed Bath & Beyond and its investors. The company will need to take decisive action to address its financial problems, and investors will be closely watching to see if it can do so. If it can’t, the short-squeeze may be just the beginning of a much larger decline.
However, BBBY stock is becoming more of a momentum and technical name, and outsized and sudden price fluctuations will not be out of the ordinary.
