Is 'bankruptcy' scaring Bed Bath & Beyond (BBBY) investors?

The word “bankruptcy” doesn’t seem to be scaring Bed Bath & Beyond (NASDAQ: BBBY) investors all that much. Shares of BBBY stock are ripping higher on the day, up more than 80% so far on Monday. In the past, the dreaded “b-word” was typically a death sentence for a stock.

What happens if BBBY goes bankrupt?

In the bankruptcy process, BBBY shareholders are last in line to get paid — after all those creditors — when the company’s assets are liquidated. Simply put, bankruptcy is unlikely to leave any cash for shareholders. With sadness, BBBY’s once loyal customers have moved on.

What happens if a company goes bankrupt?

Under Chapter 11 bankruptcy, a company provides a plan to reorganise its business. It aims to get out of debt and be profitable again. Day-to-day operations will continue to run but major corporate decisions will have to be approved by the bankruptcy court. The company’s stock and bonds will continue to trade on the market.

Is bankruptcy on the cards?

Well, perhaps. Experts are concerned that bankruptcy is on the cards. With discretionary consumer spending on the decline due to rising inflation and interest rate hikes, retail stocks like BBBY are already having a difficult time as it is.