Bed, Bath & Beyond (BBBY) shares plummeted Friday after Securities and Exchange Commission filings late Thursday indicated that Ryan Cohen, the retailer's second-largest shareholder, had completely exited his near 12% stake in the group.
Cohen's RC Ventures owns no longer owns any Bed, Bath & Beyond shares, the filings indicated, after netting nearly $60 million form the sale of 9.45 million shares over the past two days at prices ranging between $26.2713 and 18.6848 per share.
The sale was helped in no small part by a 350% rally over the past three weeks, on notably heavy retail trading volume, amid a surge in interest linked to a so-called 'short squeeze' that seeks to punish investors betting against a particular stock.
Recent data from S3 Partners suggests short interest comprises around 55% of the outstanding shares of Bed, Bath & Beyond, with bet against the retailer totaling more than $400 million.
Just five months ago, Cohen pressed the retailer to look at several strategic alternatives, including sale of its lucrative buybuy Baby division, and pushed or the ouster of CEO Mark Tritton, who left the group in June.
Bed, Bath & Beyond said Thursday that it's been "working expeditiously over the past several weeks with external financial advisors and lenders on strengthening our balance sheet", and would update investors before the end of the month on any new capital-raising plans.
Bed, Bath & Beyond shares were marked 40.7% lower in pre-market trading to indicate an opening bell price of $11.00 each, a move that would mark a two-day decline of around 62%.
GameStop (GME) shares, meanwhile, slumped 10.4% to trade at $34.00 each as retail investors, burned in part by Cohen's surprise decision to exit Bed, Bath & Beyond, dumped stocks in the money-losing video retailer that is also chaired by the RC Ventures founder.
Data from the Yolosocks.live website, which tracks real-time mentions on stocks within Reddit's r/wallstreetbets chatroom, indicated that Bed, Bath & Beyond is now the most-discussed stock among users, with activity up 66% from yesterday to around 26,600 individual posts. GameStop ranks second with 4,526 points.
