Benzinga - Interest in retailer Bed Bath & Beyond Inc (NASDAQ: BBBY) stock rose in 2022 helped by the investment by a famous figure. Many investors started following activist investor Ryan Cohen into the name after he disclosed a stake in March 2022.
Cohen cashed out on his position in August 2022 sending shares down. Here’s a look at how much Cohen may have made on his trades and what has happened since.
What Happened: In March 2022, Cohen disclosed a 9.8% stake in Bed Bath & Beyond via his RC Ventures.
“We believe Bed Bath needs to narrow its focus to fortify operations and maintain the right inventory mix to meet demand, while simultaneously exploring strategic alternatives that include separating buybuyBaby Inc and a full scale of the company,” Cohen said in a letter to the company.
The company responded saying it was committed to acting in the best interests of shareholders and had a multi-year transformation plan.
Shares rose 90% to $30.70 on news of the stake by Cohen. Investors recalled the previous sale of Chewy Inc (NYSE: CHWY) by Cohen and his large stake in GameStop Corp. (NYSE: GME), which led to a rally and his placement as the chairman of the company.
Later, it was revealed that Cohen owned stocks and options representing 9.4 million shares, or around 11.8% of the company. The stake included out-of-the-money options with a strike price of $80, which sparked enthusiasm from investors on the long-term outlook for the company.
RC Ventures paid $121.2 million between mid-January and early March to acquire 7.78 million shares. Cohen also purchased options to acquire an additional 1.67 million shares.
Cohen’s stake in Bed Bath & Beyond led to several changes for the company including changes to the board of directors.
Related Link: Former Hedge Fund Manager Calls Out Ryan Cohen's Bed Bath & Beyond Trade, Complains To SEC: 'What A Total Disgrace'
Cohen Sells Stake: After fueling a wave of new investors in the company and a rise of meme stocks once again, Cohen announced plans to sell shares in August 2022. A later filing showed Cohen sold his entire position, sending shares of Bed Bath & Beyond down.
These were the transactions listed by Ryan Cohen in a SEC filing from 2022:
8/16: Sold 446,399 shares at an average $18.6848
8/16: Sold 812,448 shares at an average $19.4817
8/16: Sold 1,443,818 shares at an average of $20.7834
8/16: Sold 1,059,021 shares at an average of $21.4209
8/16: Sold 795,559 shares at an average of $22.7093
8/16: Sold 169,335 shares at an average of $23.3293
8/16: Sold 103,901 shares at an average of $24.8685
8/16: Sold 104,077 shares at an average of $25.5918
8/16: Sold 65,442 shares at an average of $26.2713
8/17: Sold 189,689 shares at an average of $23.7337
8/17: Sold 512,185 shares at an average of $24.6266
8/17: Sold 896,238 shares at an average of $25.4997
8/17: Sold 610,828 shares at an average of $26.4432
8/17: Sold 323,483 shares at average of $27.5756
8/17: Sold 140,788 shares at an average of $28.5122
8/17: Sold 106,789 shares at an average of $29.2192
8/17: Sale of 7,475 Jan 2023 calls, $60 strike, at an average of $6.5466
8/17: Sale of 3,782 Jan 2023 calls, $60 strike, at an average of $8.6177
8/17: Sale of 444 Jan 2023 calls, $75 strike, at an average of $5.6596
8/17: Sale of 3,826 Jan 2023 calls, $80 strike, at an average of $5.3433
8/17 Sale of 1,174 Jan 2023 calls $80 strike, at an average of $7.0264
RC Ventures paid $121.2 million for its stake in Bed Bath & Beyond according to filings. The filing shows total sales of $189.3 million for the stock and options.
Cohen made a profit of $68.1 million from his stake in Bed Bath & Beyond in seven to eight months' time.
Jake Freeman, a 20-year-old college student made $100 million profit from a position in Bed Bath & Beyond. Freeman told Benzinga he bought a stake based on the balance sheet of the company.
The filings show Cohen owns 0 shares or options in Bed Bath & Beyond. The company issued a statement after the sale was reported.
“We were pleased to have reached a constructive agreement with RC Ventures in March and are committed to maximizing value for all shareholders,” the company said. “We are continuing to execute on our priorities to enhance liquidity, make strategic changes and improve operations to win back customers, and drive cost efficiencies.”
What Happened After: Shares of Bed Bath & Beyond fell after Cohen exited his position and the stock and company have failed to recover since. Shares of Bed Bath & Beyond are down over 90% in the last year now trading for less than $1 each.
The company has sought help though financing and a potential reverse split to raise additional funds.
New reports show the company could be nearing Chapter 11 bankruptcy preparations, which come as the company continues to struggle with liquidity. A report indicates that the company has held talks with lenders and advisors and a bankruptcy filing could happen before April 26, 2023.
Since exiting his Bed Bath & Beyond position, Cohen took an investment in Chinese company Alibaba Group Holding (NYSE: BABA). The investor has also teased potentially investing in an unnamed "great American brand."
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