Bed Bath & Beyond leads revival in meme stocks' rally (updated)

Vinco Ventures

17/08/2022 17:00

(Adds details on short interest)
    By Medha Singh
    Aug 17 (Reuters) - Shares of Bed Bath & Beyond Inc  BBBY.O 
jumped 23% on Wednesday, leading a surge in meme stocks again as
individual investors continued to dabble in highly shorted
shares.
    Bed Bath & Beyond has gained in 14 out of the past 15
sessions, helping the home goods company's market value more
than quadruple to over $2 billion. The stock was last trading at
$25.93 after rising up to $30 earlier in the session.
    "It truly is a quality company (but) shares are probably
overvalued in the low teens and it is ridiculously overvalued at
high $20s," said Jake Dollarhide, chief executive officer at
Longbow Asset Management in Tulsa, Oklahoma.
    Retail investors net bought $73.2 million worth of the
company's shares on Tuesday, the highest single-day purchase in
at least five years, according to Vanda Research's retail trade
flows data, as a filing showing activist investor Ryan Cohen's
long-term call option purchases enthused retail punters.
 urn:newsml:reuters.com:*:nL4N2ZS33F
    Bed Bath & Beyond was the most actively traded single stock
option on Wednesday, far ahead of popular options trades
including Apple Inc  AAPL.O  and Tesla Inc  TSLA.O , data from
Options Clearing Corp showed.
    The resurgence in retail trading comes after a rebound in
U.S. stocks that helped the S&P 500 recoup more than half of the
benchmark's losses since its June low.
    "It's possible for the meme rally to spread since there is a
lot of short-term capital entering the market. We've seen the
same with Chinese meme stocks over the past few weeks as well,"
Siddharth Singhai, chief investment officer at New York-based
hedge fund Ironhold Capital.
    Among others, e-commerce firm Vinco Ventures  BBIG.O 
advanced 32% and meal-kit delivery firm Blue Apron  APRN.N  rose
8.7%.
    About 55% of Bed Bath & Beyond's free float is shorted, an
increase of 19% in the past 30 days despite the price surge,
according to S3 Partners. 
    "While short-sellers were squeezed out when BBBY hit $10,
$15 and $20 per share, there were other traders who saw (that)
as attractive short-side entry points," said S3's Ihor
Dusaniwsky.

 (Reporting by Medha Singh in Bengaluru, additional reporting by
Bansari Mayur Kamdar; Editing by Maju Samuel)
 ((Medha.Singh@thomsonreuters.com; +91 80 6210 0592; Twitter: https://twitter.com/medhasinghs;))