Bed Bath & Beyond shares boosted by insider buying

krblokhin/iStock Editorial via Getty Images

The purchase of 50K shares by newly-minted CEO Sue Gove promoted a pop for Bed Bath & Beyond (NASDAQ:BBBY) in Wednesday’s extended session.

Shares of the New Jersey-based retailer rose over 8% at after-hours highs before moderating gains to around 5% as the news settled. Gove was only named as CEO one week ago, acceding to the role after a disastrous earnings release at the close of June.

Other insiders reporting purchases included board chair Harriet Edelman and board member Jeffrey Kirwan, each of whom bought 10K shares.

Bed Bath & Beyond (BBBY) stock has declined over 70% since the start of the year.

Read more on the further downside expected by analysts.

Comments

[Moomoo22u2]

There is crap then another 150feet lower of extreme crap then there is BBBY.

[GMEOG]

@Moomoo22u2 lol

[Landlord Investor]

Could someone still actually be interested in buying Buy Buy Baby at a reasonable price? Can’t imagine why else a CEO would put this kind of money on a company with bonds in the 20s. Is the potential 4x gain from buying the bonds and having them go to par not enough upside for her?

Even if someone bought Baby, you still may not get more upside in the stock than the bonds. Real headscratcher.

[Deep Value Ideas]

@Landlord Investor That's just window dressing. I completely agree that it does not make sense to buy the stock with the bonds at 20 cents on the dollar. A potential acquirer would certainly look at the lease maturities - BBBY has closed 500 stores since 2019, and the remaining leases are spread fairly evenly over the next five years. However, more than $600 million in leases is due after 2026.

[Horizon13]

@Landlord Investor Given the securities laws, there is no way the CEO would be able to buy the stock if she knew a sale of the Baby division was imminent. That info would be material non-public information, and she would be prohibited from trading the stock with that knowledge. Based on the fact that she did buy shares in the market, I conclude the sale of the Baby division is not imminent.

[Landlord Investor]

@Horizon13 A sale isn’t necessarily imminent but if the CEO who opposed it is now gone and the (previously announced) interested party has shown no indication they’re withdrawing interest, then it’s a much higher probability than before. Insider buying based on news that was announced months ago wouldn’t be illegal.

But…agree the purchase is most likely window dressing.

[Chris1w]

Insiders sell for many reasons but they buy for just one reason.

[Maschuette]

@Chris1w There are really two reasons. The first is because they think the stock will appreciate.

The second is to signal to the market that they think the stock will appreciate so that the stock will go up and they will look like they are doing a good job. If they can keep their job then they will get more money in form of salary and more stock.

[Chris1w]

@Maschuette If they are willing to put their own money / skin into the game, then more power to them.

[tlcunninghamcpa]

@Maschuette 50,000 shares at $5, $250,000 probably one month’s salary? Big deal. Probably window-dressing to show confidence to the market.

[rjm22]

The last time she spent a quarter million on bbby stock at under $8 it went up 6 fold in just over 6 months

Do with that what you will

[grewalg87]

87% short interest, this one will get interesting.

[Iron Eagle]

@grewalg87 - good comment here and all that really matters with this stock at this time. Not sure of the accuracy of the short interest but the short sharks smell blood in the water and a feeding frenzy will attract fishermen.

[Clark158f1]

Use any pop to get out.....this puppy will see BK

[WD216]

Apparently according to the comments, BBBY can't win for losing. The CEO put up about 1/4 million dollars of her own money within one week of getting that title. To me that shows confidence and her seeing a turnaround. Comparisons to Radio Shack are clueless. Specialty Electronics and just about a store in every town to BBBY which operates completely different. But hey if it makes 6228371 feel good speaking with authority, then go for it. But to everyone else, listen and make your own rational decision. Probably wise not to listen people who lost their shirt on BBBY, which is what my guess is 6228371 did.

[6228371]

@WD216

Sue Gove recently spending around $250K on BBBY shares isn't much compared to her net worth. If she put 50% or more of her net worth into BBBY shares I would be impressed. Others might be impressed with 25%.

"The current estimated net worth of Bed Bath & Beyond Inc's INTERIM CEO, Sue Gove, is estimated to be about $13.74M. "

www.benzinga.com/...

[Seeking more alpha than you]

@6228371 “I would be impressed.” Why does that matter?

[6228371]

@Seeking more alpha than you

"“I would be impressed.” Why does that matter?"

LOL!!!!

Do you think a CEO making a stock purchase for around 2% of their net worth is so significant?????

[qwerty11]

No insider knowledge I hope

[6228371]

@qwerty11

"No insider knowledge I hope"

If they are buying now at $4+ they are Imo most likely clueless. How many Radio Shack insiders were buying the stock
within two years of bankruptcy? I remember Radio Shack borrowed plenty of money to repurchase shares. They also did extensive renovations near the end. Why do troubled companies make things worse with expensive renovations? Do they feel they have nothing to lose?

[onion bot]

@6228371 thank you for stopping me making a mistake by buying $BBBY for my “spec” account. The Radio Shack comparison speaks to me 👍🏼

[6228371]

@onion bot

" thank you for stopping me making a mistake by buying $BBBY for my “spec” account. The Radio Shack comparison speaks to me 👍🏼'

The renovations, plus a much stronger emphasis on store brands is what reminded me the most about the similarities between BBBY and Radio Shack. Overpricing some name brand items thinking that it will convince shoppers to buy their generic stuff is not a good strategy. People are likely to buy neither one.

[tjohnston01]

Yes, small dollars.

Glad I sold after the meme bumps!

[conflictednews]

Chump change. Just going through the motions.