Bed Bath & Beyond Up 68% to Lead Last Gasp Meme Stock Rally
As retail investors push meme names higher in the new Year after a poor 2022, a number of highly speculative stocks rose by double digits Wednesday.
Bed Bath & Beyond The trend Wednesday saw shares of a company jump by 68.6% Shares of GameStop, the original star in 2021’s meme stockmania, has risen more than 7 % AMC Entertainment The rise was more than 21%
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| Stock | Short interest % float | Gain | % off the 52W high |
|---|---|---|---|
| Bed Bath & Beyond | 48.9% | 68% | -88% |
| AMC (AMC). | 21% | 21% | -77% |
| GameStop (GME). | 21% | 7% | -62% |
“We don’t love the strength in nonsense stocks like AMC, CVNA, GME, BBBY, PRTY, etc.,” Adam Crisafulli is Vital Knowledge’s founder. “This just means people are blindly chasing.”
A group of retail traders joined hands on social media in early 2021 to buy up a number of stocks that were heavily shorted. This created massive short squeezes which caused high pain for short sellers. These meme stocks saw huge pullbacks last year as risk sentiment changed due to aggressive rate increases. GameStop lost 50% in 2022, AMC dropped 75%, and Bed Bath & Beyond fell 82%.
Although the short interest has declined from its peak following the jaw-dropping episode it is still much higher than the average.
According to S3 Partners’ analysis, 48% of Bed Bath & Beyond float share shares are shorted, compared to a typical U.S. stock that has a 5% average short interest. According to FactSet, GameStop’s short interest is currently at 21%. This is a decrease of more than 100% during the peak of the meme stock mania. AMC also sells short 21%.
Short squeeze occurs when a stock rises dramatically. It forces short sellers to purchase back shares to limit their losses. Short covering can help fuel the stock’s rally.
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