Bed Bath & Beyond Has More Stock to Sell
Also narrow banking through reverse repo and game-used baseball shoulder patches.
Programming note: Money Stuff will be off tomorrow and next week, back on April 10. Empirically this is expected to dampen market volatility, though this is not investing advice and past results may not be representative of future performance. But enjoy a nice quiet week in financial markets without me, have fun, try not to break anything.
In early February, Bed Bath & Beyond Inc. was skating pretty close to bankruptcy. If it had filed for bankruptcy, the expected outcome would be that its shares of stock would be worthless and its creditors would end up owning the company; probably the company would have liquidated, stores would have closed, and the creditors would get pennies on the dollar. But it was not there yet: At the beginning of February, Bed Bath’s stock traded at around $3 per share, for an equity market capitalization of around $300 million to $400 million, because shareholders held out some hope. On a bankruptcy filing, that value would more or less immediately jump to zero.1