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Meme stock darling Bed Bath & Beyond is ready to file for bankruptcy this week, report says

Customer walks into Bed Bath & Beyond storeBed Bath & Beyond is preparing to file for bankruptcy as early as this week, according to Reuters.

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  • Bed Bath & Beyond is ready to file for bankruptcy as soon as this week, according to Reuters.
  • The company defaulted on a loan to JPMorgan and said it would close 87 stores last week.
  • Bed Bath shares climbed 1.7% ahead of Tuesday’s opening bell.

Bed Bath & Beyond could file for bankruptcy protection as early as this week, Reuters said Monday.

The retailer will bring in liquidators to close its stores unless it’s able to negotiate an unlikely last-minute rescue package, according to a report by the publication that cited four people familiar with the matter.

Bed Bath said Thursday that it lacked the cash required to pay its debts and had received a default notice from JPMorgan, taking it one step closer to a potential bankruptcy.

The company then said the following day that it is preparing to shut down 87 more of its stores – following the 150 closures it announced last year.

Shares fluctuated wildly last week, plunging as much as 35% after the default announcement but staging a 17% rally Friday with investor sentiment buoyed by the expectation that the store closures would help the firm to save up some cash.

Bed Bath shares climbed 1.7% to $2.92 in early-morning trading Tuesday.

The retail chain is seen by some analysts as a “meme stock” alongside companies such as GameStop and AMC Entertainment, enjoying a high level of popularity with retail investors despite poor underlying financial data.

It has climbed 14% year-to-date, benefiting from the store closures it has announced as well as the market’s expectation that the Federal Reserve will start slashing interest rates at some point later this year.

Read more: Bed Bath & Beyond sinks 35% after the retailer says it lacks funds to pay debts and receives a default notice from JPMorgan

Read the original article on Business Insider
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