Yesterday saw the stock price of NASDAQ-listed Bed Bath & Beyond (NDQ:BBBY) jump more than 60% in the US trading session on the news that Ryan Cohen had taken control of almost 10% of the company via his company RC Ventures. Readers may also be familiar with Cohen because he is currently also the Chairman of GameStop (NYQ:GME).
This is very much an activist play from Cohen, who has written to the management of BBBY to recommend it contemplates going private and that it also look at selling its Buybuy Baby chain. BBBY stock had been on a bit of a downward slope, really since the end of last year when it came off the $24 level. The strong rally in the stock has it nearly back at that level, trading at $21 at time of writing.
From the perspective of Cohen, BBBY may look like an interesting turnaround situation, especially as the shares are well down on $30-35 level where they were trading in mid-July. But is the enthusiasm of investors warranted?
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