Bed Bath Beyond stock down 31% in pre-market

Bed Bath Beyond's BBBY stock is down 31% in the pre-market on Tuesday morning. The retailer plans to raise as much as 1.025 billion through an equity offering.

BBBY had gained 92% on Monday, ahead of the announcement after the market closed, as a recent rally in the company continued to gain momentum. The stock was up as much as 120% during the trading session.

According to S 3 Partners, short interest in the retailer is about 53% of the float.

Bed Bath Beyond is trying to conserve cash as it teeters on the edge of bankruptcy due to the fact that it has more than $1 billion in debt and losses by the end of 2022.

The company warned in a recent regulatory filing that it had been hit with a default notice from JPMorgan and doesn't have enough funds to repay its loans.

Meme stocks have rallied over the past month as some of the trades reminiscent of the 2021 meme craze have regained popularity so far this year.

GameStop GME is up 29% year-to-date and AMC AMC shares have gained 68% since the beginning of 2023. AMC halted its trading on Monday for volatility as the stock climbed as much as 19%. The shares were 11% higher on Monday.

The stock of Bed Bath Beyond hit a 52 week low of $1.27 on January 6th, with shares more than quadrupling since.

Over the past month, investors have taken a risk-on approach, with AI-related equites joining tech names as the biggest winners in addition to meme names from yesteryear.

Artificial intelligence maker C 3 ai AI went up 6% on Monday, while smaller-cap, lesser-known names like BigBear.ai BBAI went up 18%, and the voice AI company SoundHound SOUN increased 42%.