How to Buy Bed Bath & Beyond Stock

Bed Bath & Beyond stock has once again caught the attention of the WallStreetBets sub-forum on Reddit.

In the prior month alone, this stock has managed to generate gains of over 100% – even though the markets are arguably in a bearish cycle.

The purpose of this beginner’s guide is to explain how to buy Bed Bath & Beyond stock from a regulated online broker that offers 0% commission trading.

Assuming that the NASDAQ exchange is open at the time of the order, the chosen broker will complete the Bed Bath & Beyond stock purchase on behalf of the investor.

The stocks will subsequently remain in the investor’s portfolio until they decide to cash out.

Step 1: Choose a Stock Broker 

In order to buy Bed Bath & Beyond stock, investors will first need to open an account with a regulated broker that offers access to the NASDAQ exchange.

There are many brokers operating in this space, so investors should choose a provider based on core factors surrounding fees, user-friendliness, minimum balance requirements, customer service, and more.

To offer insight into where to buy Bed Bath & Beyond stock online – below we provide reviews of popular brokers that might be of interest.

1. Capital.com

Capital.com is a popular CFD trading platform – which means that US clients will not be permitted to open an account. Nonetheless, traders from other regions of the world will be able to open a Capital.com account in less than five minutes.

After verifying the account, traders will have access to more than 5,400 stock CFDs from nearly 20 US and international exchanges – including NASDAQ. As a result, traders will be able to speculate on the future value of Bed Bath & Beyond stock without taking ownership of the underlying equities.

When trading stock CFDs at Capital.com, users will have the option of applying leverage of up to 1:5. In simple terms, this means that a $100 position can be amplified to $500. Moreover, Capital.com supports long and short orders. This means that the user can attempt to profit from rising and falling Bed Bath & Beyond stock prices.

When it comes to trading fees, Capital.com does not charge commissions. Instead, the platform makes its money from the spread – which is the gap between the bid and ask price of Bed Bath & Beyond stock. At the time of writing, the spread on Bed Bath & Beyond stock amounts to $0.49 per slide.

Deposits and withdrawals at Capital.com across all supported payment methods are fee-free. This includes debit/credit cards and e-wallets ($20 minimum) and conventional bank wires ($250 minimum). Traders wishing to access analysis tools can do so at Capital.com across three supported platforms.

This includes MT4, as well as the Capital.com web-trading platform and mobile app. All three options support technical and economic indicators, advanced order types, and chart drawing tools. Capital.com also provides a wealth of information on Bed Bath & Beyond stock.

This includes historical pricing action, the date of upcoming earnings reports, and even extracted data from the firm’s balance sheet and income statement. In addition to stocks, Capital.com supports thousands of other leveraged CFD markets – which is inclusive of indices, hard metals, energies, ETFs, cryptocurrency, and forex.

78.91% of retail investor accounts lose money when trading spread bets and/or CFDs with this provider.

2. Webull 

The next option to consider when learning how to buy Bed Bath & Beyond stock is Webull. Founded in 2017, Webull is a popular brokerage site that caters to retail clients in the US. The SEC-regulated broker offers a variety of accounts and there is no minimum deposit requirement to meet.

This includes standard investment accounts alongside Roth and traditional IRAs. Webull only supports two deposit methods – ACH and domestic bank wires. While the former is fee-free, the latter attracts an $8 and $25 fee for deposits and withdrawals respectively.

Nonetheless, after the Webull account has been verified and funded, investors can then proceed to buy Bed Bath & Beyond stock without paying any commission. Webull supports a fractional investment tool that requires a minimum stock and ETF trade of just $5. Those wishing to buy cryptocurrency at Webull can do so at a lower minimum stake requirement of $1.

In addition, Webull also offers stock options. This will enable US-based investors to speculate on the future value of Bed Bath & Beyond stock without taking ownership of the equities up front. In a similar nature to the aforementioned Capital.com, the Webull platform offers an extensive selection of research materials.

In the technical department, this includes comprehensive pricing charts, drawing tools, and economic indicators. Webull also offers market insights and new developments from third-party sources. The Webull mobile app for iOS and Android is also popular with investors that wish to trade stocks on the move.

Another aspect of the Webull platform is its educational tools. This offers courses on how to invest in stocks, utilize technical indicators, and more. There are also explainers on the many different asset classes supported by Webull, alongside handy videos. Finally, Webull also offers OTC services for those that wish to invest larger amounts.

Your capital is at risk

Step 2: Research Bed Bath & Beyond Stock

Before electing to buy Bed Bath & Beyond stock, it is important to ensure that the investment has been researched in great depth. This should begin with an analysis of the financial standing of Bed Bath & Beyond – such as its debt levels and P/E ratio.

Moreover, consider researching the firm’s recent earnings reports and compare this to prior quarters to assess whether Bed Bath & Beyond represents a viable investment thesis.

With this in mind, the sections below offer a comprehensive overview of the core research materials to take into account when assessing whether to buy Bed Bath & Beyond stock.

What is Bed Bath & Beyond? 

Founded in 1971, Bed Bath & Beyond is a US-based supplier of domestic goods. This includes everything from bedding, furniture, and luggage to health products, gifts, and kitchen appliances.

The firm has many chains throughout the domestic market and has since expanded into other regions – such as Canada and Mexico. Bed Bath & Beyond is increasingly investing in its online presence, with the firm offering home deliveries to those in the US.

Bed Bath & Beyond Stock Price – How Much is Bed Bath & Beyond Stock Worth?

Bed Bath & Beyond is a public stock listed on the NASDAQ exchange. The firm first went public in 1992 at a now adjusted opening price of $1.08 per share. This takes into account the four stock splits that Bed Bath & Beyond has initiated since going public. The most recent split came in 2000 on a 2-for-1 basis.

Over the course of two decades after its IPO listing, Bed Bath & Beyond was a top-performing stock. In fact, in 2014, Bed Bath & Beyond stock hit an all-time high of over $80. This means that when compared to its adjusted IPO price, Bed Bath & Beyond stockholders were looking at gains of over 7,000%.

However, other than a slight recovery in the following year, Bed Bath & Beyond stock has been on a downward trend since. The stock appears to have bottomed out in mid-2020 – where Bed Bath & Beyond breached lows of just under $4. The stock then went on a short-lived bullish run – hitting $35 in early 2021.

When compared to its 2020 lows, this represents growth of over 700% in less than a year of trading. Crucially, as we cover in more detail later, Bed Bath & Beyond stock has once again entered bullish territory, not least because the Reddit sub-forum WallStreetBets has taken another keen interest in the firm.

As a result, in the one month of trading prior to writing this guide, Bed Bath & Beyond has generated gains of over 130%. Moreover, in the 24 hours prior to writing, the stock has witnessed growth of almost 40%. This ultimately shows how effective WallStreetBet has become in moving stock prices collectively.

With that said, based on prices of writing, Bed Bath & Beyond is still trading with a market capitalization of less than $ 1 billion. This is the case even though the firm has more than doubled its valuation in the prior month of trading. Therefore, Bed Bath & Beyond is a small-cap company, and accordingly – its stock price movements will be a lot more volatile than conventional blue-chips.

Bed Bath & Beyond Stock – EPS

Assessing the EPS of Bed Bath & Beyond stock is a great way to evaluate the firm’s profitability.

Over the prior four full-year accounts, the Bed Bath & Beyond EPS was as follows:

• 2022: -5.64
• 2021: -1.24
• 2020: -4.94
• 2019: -1.02

As per the above, over the prior four years of trading, Bed Bath & Beyond continues to report a negative EPS. The reason for this is simple – Bed Bath & Beyond continues to lose money.

We explore the balance sheet of Bed Bath & Beyond stock further down.

Bed Bath & Beyond Stock – P/E Ratio

Another core accounting metric to consider when learning how to buy Bed Bath & Beyond stock is the P/E ratio.

Leading on from the section above, it will come as no surprise to learn that Bed Bath & Beyond does not currently have a P/E ratio to report. Once again, the reason for this is that Bed Bath & Beyond is losing money and thus – it has a negative EPS.

This subsequently means that we cannot compare the P/E ratio of Bed Bath & Beyond stock with other companies in the same sector to assess whether or not the firm is potentially over or undervalued.

Bed Bath & Beyond Stock Dividends

With a negative EPS and a revenue model that continues to lose money, it likely comes as no surprise to learn that Bed Bath & Beyond stock does not generate dividends.

After all, it is crucial for the firm to retain its free cash flow to help turn the fortunes of the business around. With that said, as we cover in the section below, Bed Bath & Beyond stockholders are still holding onto the hope that the firm will follow through with its proposed share buyback scheme.

Note: Looking for income-paying stocks? Read our guide on dividend stocks to find out which companies are currently offering an above-average yield.

Bed Bath & Beyond Stock Buyback

In late 2021, management at Bed Bath & Beyond announced a rather ambitious plan to engage in a stock buyback program. The program – which would see Bed Bath & Beyond utilize its much-needed cash reserves to purchase its own stock from the open market, would require a capital injection of over $1 billion.

On the one hand, this will, of course, appeal to existing Bed Bath & Beyond stockholders. After all, when companies buy back their own stocks, this reduces the overall supply of equities in the market.

And thus, in theory, this has the desired impact of artificially increasing the stock price of the respective company. However, it remains to be seen how Bed Bath & Beyond can realistically afford to meet these obligations considering that the firm continues to lose money.

As per the chart above – Bed Bath & Beyond stock surged more than 90% in just one day of trading on news of the buyback announcement.

Bed Bath & Beyond Stock: Fundamentals

When learning how to buy Bed Bath & Beyond stock, investors must consider the fundamentals before proceeding with an investment.

This simply means considering both the good and bad currently facing Bed Bath & Beyond as a company.

Our comprehensive research found that the most important considerations to make on Bed Bath & Beyond stock are as follows:

WallStreetBets

We mentioned earlier that in the one month prior to writing this guide, Bed Bath & Beyond stock has witnessed a valuation increase of more than 130%. In just 24 hours of trading, the stock increased by nearly 40%.

It goes without saying that the primary reason for this sudden surge in value – especially when considering its recent quarterly results, is a result of heightened interest from WallStreetBets.

For those unaware, WallStreetBets is a sub-forum on the popular social media platform Reddit. As of writing, the WallStreetBets forum is home to more than 12.3 million subscribers.

Often dubbed as a ‘meme stock frenzy’, WallStreetBets has been successful in collectively pumping the value of struggling companies like GameStop and AMC by considerable amounts.

And, it appears that it is now Bed Bath & Beyond’s turn to benefit from this meme-inspired price surge. With this in mind, investors should tread with extreme caution before electing to buy Bed Bath & Beyond stock.

After all, if the firm’s recent stock price surge is confirmed as a result of WallStreetBets, then this means that the likelihood is that its value will eventually return to levels previous to the pump.

Crucially, investors should only consider buying stocks in a company that offers a viable opportunity for long-term growth – based on the fundamentals.

Potential Short Squeeze

There is growing sentiment that the recent surge in the value of Bed Bath & Beyond stock is due to a short squeeze. This viewpoint could be credible considering that Bed Bath & Beyond is one of the most shorted stocks on Wall Street.

In fact, recent estimates suggest that 45% of the stock’s free float is currently being shorted by hedge funds. For those unaware, a short squeeze occurs when a heavily shorted stock experiences buying pressure.

This buying pressure subsequently results in the short sellers having their positions liquidated, which results in the firms being forced to buy back the stocks. In the case of Bed Bath & Beyond, this could be the reason why its stock surged nearly 40% in a single day of trading.

Earnings Report

Make no mistake about it – the most recent earnings call reported by Bed Bath & Beyond was nothing short of a disaster.

In fact, the firm missed Wall Street expectations by such a considerable amount that it was subsequently announced that CEO Mark Tritton has left the company.

Let’s summarize some of the key findings from the firm’s period ending Q2 2022:

• Revenues were reported at $1.46 billion – down 25% year over year
• EPS was reported at -$2.83, which was $1.44 worse than the markets had anticipated
• EBITDA was reduced to just $215.9 million, while net income stood at -$357.6 million

The Q2 2022 earnings report should act as a major red flag for existing and potential stockholders.

However, as we have discussed, Bed Bath & Beyond stock has since surged in value nonetheless. This is a clear indication of an irrational market.

Upside Potential

Investors learning how to buy Bed Bath & Beyond stock might be doing so with the view of targeting above-average gains in a short period of time.

While this has certainly been the case for those able to buy Bed Bath & Beyond stock just a month ago at sub-$5 per share, there is no knowing how long this bullish rally will remain in place.

With that being said, it is important to note that as of writing, Bed Bath & Beyond still carries a market capitalization of under $1 billion. As a result, the upside potential of this stock might appeal to investors that possess a higher tolerance for risk.

Over the prior five years, the most that Bed Bath & Beyond stock has been worth is just over $35. This means that if the stock is able to get back to this pricing level, it would require an upside of over 200%.

Whether or not the stock has what it takes to reach this pricing level remains to be seen.

Insider Buying

Seasoned investors will typically take notice when high-level managers and directors of a company trades its own stock. It goes without saying that when management decides to sell their own stocks in the open market – this is a major red flag.

After all, it could indicate that management no longer has faith in the company that they are running.

However, in the case of Bed Bath & Beyond, high-level management continues to buy the stock – as they have been doing for the prior 12 months.

This suggests that despite the firm’s recent struggles, management believes in the long-term potential of Bed Bath & Beyond stock – especially at current prices.

Cost-Cutting Program

Another benefit to take from the current strategy being employed by Bed Bath & Beyond management is that the company continues to implement its aggressive cost-cutting program.

This will help the firm grow and retain much-needed free cash flow and crucially – reduce its long-term debt obligations.

One such example is that the vast majority of Bed Bath & Beyond stores no longer manufacture and sell their own products. Instead, stores are importing cheaper alternatives and selling merchandise under the Bed Bath & Beyond brand.

In addition to cutting costs, this will help improve operating margins for the firm.

Bed Bath & Beyond Stock Price Prediction – Sell-Side Analysts

Below, we discuss sell-side analyst ratings on Bed Bath & Beyond stock over the prior three months of trading:

• Buy: 0%
• Hold: 38%
• Sell: 62%

In terms of Bed Bath & Beyond stock price predictions, the same sell-side analysts have an average target of just $3.62. The low and high estimate stands at $1 and $7.50.

As of writing, Bed Bath & Beyond stock is trading at nearly 50% above the aforementioned high estimate. Once again, this highlights just how much of a speculative and irrational market Bed Bath & Beyond stock finds itself in.

Step 3: Open a Trading Account 

To conclude this guide on how to buy Bed Bath & Beyond stock, we explain the steps required to complete the investment with a regulated online broker.

Open a Brokerage Account

The first step is to choose a suitable broker that offers access to Bed Bath & Beyond stock. We discussed popular brokers active in this space earlier on – so for a recap – scroll up.

After choosing a suitable broker, open an account with the provider. This will require the investor to supply some personal information and contact details. US investors will also need to provide their social security number for verification purposes.

Upload ID

Next, the broker will need to ask the investor to upload a couple of verification documents.

For proof of identity, the investor will need to upload a passport, driver’s license, or state ID card. For proof of residency, most brokers accept a recently issued bank statement or utility bill.

Deposit Money

Once the account has been verified, the investor will need to make a deposit. Accepted payment types will vary from one broker to the next, but most support bank wires nonetheless.

Some of the brokers discussed earlier also support debit/credit cards and e-wallets – both of which are credited to the account instantly.

Just remember that some brokers have a minimum deposit requirement.

Buy Bed Bath & Beyond Stock

Once the brokerage account has been funded, the investor can proceed to buy Bed Bath & Beyond stock.

• Most brokers have a search function. If so, type in the stock symbol – BBBY
• Enter the total amount of money to be invested in Bed Bath & Beyond stock
• Confirm the order

If the NASDAQ exchange is open at the time of placing the order, the broker will instantly execute the trade and add the Bed Bath & Beyond to the investor’s portfolio.

Conclusion

This guide has explained the basic process of how to buy Bed Bath & Beyond stock.

Focusing purely on the fundamentals, Bed Bath & Beyond is struggling in most departments, espcially when it comes to its declining revenue and operating profits. Moreover, Bed Bath & Beyond is one of the most shorted stocks on Wall Street.

However, with all that being said, Bed Bath & Beyond stock has generated gains of over 130% in the prior month alone – 40% of which has come in the past 24 hours of writing this guide.

Ultimately, investors will need to understand the inherent risk of buying Bed Bath & Beyond stock before proceeding.

FAQs