Bed Bath & Beyond (NASDAQ:BBBY) stock is jumping more than 30% in pre-market trading today and has notched gains of more than 300% so far in August.
Among the factors behind the stock’s tremendous gains in recent weeks have been the rejuvenation of the meme-stock phenomenon and the decision by a famous investor to bet more money on BBBY stock.
The wager by the famous investor, GameStop (NYSE:GME) Chairman Ryan Cohen, has fueled excitement about BBY stock on social media, pushing Bed, Bath & Beyond’s shares much higher.
BBBY Stock: Meme Stocks Are Making a Comeback
Bed Bath & Beyond has soared 270% in the last month and nearly 97% in the last five days.
Other meme stocks have also been rallying so far in recent weeks, with AMC (NYSE:AMC) stock advancing 42% over the last month, Koss (NASDAQ:KOSS) climbing 32% during that time frame, and Fubo (NYSE:FUBO) delivering a return of 122% over the last month.
Cohen’s Bet Fed the Meme-Stock Frenzy
A company controlled by Cohen purchased call options on nearly 1.7 million shares of BBBY stock, regulatory filings unveiled on Monday night showed. Cohen initially gained fame as the founder of Chewy (NYSE:CHWY), an e-commerce firm that focuses on products for pets.
The call options have “strike prices between $60 and $80” and expire in January. For Cohen to make money on each option, the price of Bed Bath and Beyond’s shares has to exceed the option’s strike price when he redeems it. In pre-market trading, the shares were changing hands for slightly over $27 each.
The disclosure of Cohen’s call options appears to have excited retail investors, in turn lighting a fire under BBBY stock. Since Monday night, the amount of chatter about the stock on social media has surged, while the retailer’s shares have already soared nearly 70%.
On the date of publication, Larry Ramer did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.