Teddy’s not feeling too good today.  That’s because stuffed-toy retailer Build-A-Bear Workshop (BBW) started its day with a wider-than-expected quarterly loss.  The company, which allows customers to make their own stuffed animals at retail stores, said it saw poor demand in North America that largely offset rising sales in Europe.  

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In Q3, the retailer posted a loss $4.8 million, or 12 cents a share, on an adjusted basis.  Wall Street was expecting a loss of just 6 cents per adjusted share.  The real negative here in this report was the company’s consolidated comparable-store sales figures, which declined 12.9% over the prior year.  This decline included a 16% fall in North American store sales, but an increase of 2.5% in European store sales.  As you might expect, shares of BBW plunged on the news, and the shares now trade well off their recent highs.

If we look at the chart here of BBW, we can see the sharp sell off over the past two trading session.  What we also can see is a big surge higher in the shares at the beginning of October, as the stock breached both its short-term, 50-day moving average (blue line), as well as its long-term, 200-day moving average (red line).

After today’s selling, however, the stock’s been taken down to that 50-day moving average support level.  With this kind of volatility in BBW shares, this is not the kind of stock for the feint of heart.  If you’re looking to build portfolio gains on this Teddy bear’s dip, then I’d be very careful.  The technical pattern in this stock shows Teddy throwing a buying and selling tantrum every couple of months for the past year. I think there are far better toys out there for traders to play with, so you might want to avoid this bear until the stuffing settles.

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