Bed Bath & Beyond Inc. (NASDAQ:BBBY) shares surged Thursday morning after several filings with the U.S. Securities and Exchange Commission (SEC) showed recent insider buying.
What Happened: The largest and most noteworthy insider buying comes from the newly appointed interim CEO Sue Gove, who took the helm last week from Mark Tritton. Gove's recent purchase represents nearly a quarter of a million bet on the home furnishings retailer. Here's a breakdown:
- Gove disclosed the purchase of 50,000 shares at an average price of $4.61 per share.
- Board member Harriet Edelman disclosed the purchase of 10,000 shares at an average price of $4.94 per share.
- Jeff Kirwan, also a board member, purchased 10,000 shares at an average price of $4.90 per share.
Gove is likely trying to instill confidence in the company's investor base following its disastrous quarter, which led to Tritton's resignation.
See Also: Ryan Cohen Throws Shade At Mark Tritton
Why It Matters: Bed Bath & Beyond's stock has been in freefall over the last three months, trading lower by nearly 75% over that time. Several analysts have negative ratings on Bed Bath & Beyond and one is even predicting impending bankruptcy.
Last week, in an interview on "Yahoo Finance Live," Loop Capital's Anthony Chukumba warned that Bed Bath & Beyond's days are numbered.
"We could be talking about months at this point. We are in the end days," Chukumba said.
See Also: 'It's Game Over': Loop Capital Analyst Warns That Bed Bath & Beyond's Days Are Limited
This wasn't the first time that Chukumba warned investors about the struggling retailer. He was expecting worse quarterly results than most analysts and he was right. Revenue declined 25% year-over-year and the company missed earnings estimates by a wide margin.
"Let's not get it twisted," he said. "This company was in a lot of trouble even when things were good. Now that things are bad, you know, it's game over."
If Chukumba is right, the insider activity looks like it will at least buy the company some time, but Gove seems to be betting on herself and a turnaround for Bed Bath & Beyond.
BBBY Price Action: Bed Bath & Beyond has a 52-week high of $31.70 and a 52-week low of $4.38.
The stock was up 15.4% at $5.15 at press time, according to data from Benzinga Pro.
Photo: Mike Kalasnik from Flickr.
