Bed Bath & Beyond meme shares rise on record volume, defying yet another analyst's 'sell' call

Shares of Bed Bath & Beyond Inc. blew up again on Tuesday as retailers pushed back with renewed vigor on another Wall Street analyst’s warning that investors were selling because of “unrealistic” valuations.

The stock

fell as much as 4% about a minute after the open before making a sharp reversal. Shares of memes jumped 57.7% in very active midday trading and now more than doubled (up to 138%) in three days. It skyrocketed 450% in a 14-day period in which it went up on 13 of the days.

Trading volume exploded to a record high for the stock at 188.3 million shares before midday Eastern. The stock was halted twice due to volatility in morning trading.

B. Riley analyst Susan Anderson cut her sell rating from neutral, while reaffirming her price target on the stock at $5, implying about an 80% downside from current levels.

She said the downgrade comes after shares ( BBBY ) surged even after the home goods retailer reported “very weak” fiscal results for the first quarter which led to the removal of its CEO.

“BBBY has recently caught the attention of retailers in Wall Street Bets Reddit forum againwho rose to prominence in the GameStop saga as early as January 2021,” Anderson wrote in a note to clients. “We believe BBBY is currently trading at unrealistic valuations.”

On the bright side, she said the rally could provide the company with a “long-term lifeline,” like previous meme stocks like GameStop Corp.

and AMC Entertainment Holdings Inc.
have used the increase in Wall Street bets to raise cash sales of shares for money.

Anderson is the second analyst to turn bearish on Bed Bath & Beyond in the past week. Of the 19 analysts surveyed by FactSet, 11 now have the equivalent of a sell rating on the stock. Only one analyst is bullish and the remaining seven are neutral. The stock’s average price target is $3.49, implying an 86% downside from current levels.

Read also: Bed Bath & Beyond shares record longest winning streak in 15 years after Baird analyst suggests it’s time to sell.

The short interest or number of bear bets on the stock represented 47.2% of the publicly traded, or shares available for public trading, according to the latest stock market data. This compares with 23.5% for GameStop and 18.4% for AMC.

Shares of Bed Bath & Beyond are up 73.1% year to date, but have lost 8.3% over the past 12 months. In comparison, the SPDR S&P Retail exchange-traded fund

has fallen 22.7% in the past year and the S&P 500 index

fell by 4.1%.

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