Mattress Tub and Past will get uncommon purchase ranking, however 2 merchants would not chew
Bed Bath and Beyond can be out of reach.
Although the retailer received a rare buy rating this week from B. Riley, who initiated the name with a target price of $ 44 and an upbeat argument for its new management and cost-cutting strategies, the stock doesn’t look particularly attractive at its current levels, two shared Traders on Thursday the “Trading Nation” of CNBC with.
The $ 3.5 billion company’s earnings and revenue growth forecasts may look better than those of its industry peers, but are still below expectations when compared to the broader market, Chantico Global founder and CEO Gina Sanchez said in an interview on Thursday.
“It’s really hard to get upset,” she said. “We think they are the right price and this is not necessarily a screaming buy.”
Bed Bath and Beyond has already risen by 78% since the beginning of the year and is trading at a multiple of almost 20.5 times the price-earnings term.
The history of the stock as a Reddit favorite is also doing investors a disservice, Sanchez said.
“Once that momentum takes hold in the market, you’re pretty late because these momentum trades on some of these meme stocks have nothing to do with fundamentals,” she said. “If you buy it just for the momentum, that’s the worst reason to buy because you will inevitably be the bigger fool in this story.”
One possibility that could develop has to do with Bed Bath and Beyond’s brief interest, said Matt Maley, chief marketing strategist at Miller Tabak, in the same “Trading Nation” interview.
Both times this year the stock got swept up in Reddit trading – first when GameStop rallied in January and again when AMC skyrocketed in June – it had remarkably high short interest, Maley said.
Zoom In Icon Arrows pointing outwards
“Now it’s down again. If anything, it’s got incredibly low short interest, not a high one. So people have to be very, very careful,” warned Maley. “If we … get another short squeeze, Bed Bath and Beyond won’t be one of the stocks being squeezed that way.”
While the company’s recovery history may sound promising, it will likely take time for the stock to reflect, the strategist said.
“They’ve made some good changes and their revenue has been pretty good, but I just don’t think people should be looking for another missile shipping like we’ve seen twice this year,” he said hey.
Disclaimer of liability