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Dilution Alert: Bed Bath & Beyond Files to Sell $150 Million in BBBY Stock

  • Bed Bath & Beyond (BBBY) stock is down today after the company filed to issue $150 million in more stock.
  • The company also said that it’s investigating a potential data breach.
  • BBBY stock is taking an 8% hit as a result this morning.
Bed, Bath & Beyond (BBBY) storefront with trees in front
Source: Shutterstock

Today, Bed Bath & Beyond (NASDAQ:BBBY) stock investors are getting a difficult one-two punch. For one, the company is ramping up its share-sale program, raising dilution concerns. On top of that, however, BBBY stock is sliding after the company reported a phishing scam which may have compromised some of its data.

Bed Bath & Beyond was a prominent short-squeeze target in 2021 and then again earlier this year. However, it appears that the Reddit crowd isn’t coming to its rescue again today. The bad-news bears are fully in control.

The words “phishing scam” are enough to scare anyone away. Per Reuters, someone allegedly used this type of scam to improperly access company data.

Apparently, the perpetrator accessed the company’s “hard drive and certain shared drives of one of its employees.” However, Bed Bath & Beyond doesn’t yet believe “any sensitive or personally identifiable information” has been compromised. Management also assured that the incident will likely not have any “material impact.”

What’s Happening With BBBY Stock?

BBBY stock was already reeling from the impact of high inflation on Bed Bath & Beyond’s business over the past year. As of this writing, however, shares are down by another 8% and trading below the crucial $5 penny-stock level.

Of course, investors are certainly concerned about inflation and the possible data breach. But there’s another problem to consider. Specifically, a share-dilution issue is on the table today.

Not long ago, Bed Bath & Beyond prepared for an at-the-market offering (ATM) of up to 12 million shares. At the time, this equated to 15% of the company’s outstanding shares.

BBBY stock fell when traders first heard about that news. Now, though, a similar event on a bigger scale is taking place. The company intends to sell an additional $150 million worth of shares. This $150 million extension to the at-the-market offering represents around 37.5% of Bed Bath & Beyond’s market capitalization.

Reportedly, investors aren’t too pleased that Bed Bath & Beyond is getting ready to sell more shares. So, some BBBY stock traders are undoubtedly discussing share-dilution concerns right now, among other issues. It’s not an ideal way for the company’s downtrodden investors to cap off a roller-coaster week and prepare for the potentially make-or-break shopping season, either.

On the date of publication, David Moadel 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 Publishing Guidelines.

David Moadel has provided compelling content – and crossed the occasional line – on behalf of Motley Fool, Crush the Street, Market Realist, TalkMarkets, TipRanks, Benzinga, and (of course) He also serves as the chief analyst and market researcher for Portfolio Wealth Global and hosts the popular financial YouTube channel Looking at the Markets.

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