- Mattress Tub & Past’s inventory has been on a rocky journey prior to now two years – and now the retailer is on the verge of chapter.
- The corporate’s shares have plunged about 91% since early 2021 when it surged amid the meme-stock frenzy.
- This is a timeline of the important thing occasions that fueled Mattress Tub & Past’s tumultuous journey.
Mattress Tub & Past, the once-beloved residence items retailer, has seen its fortunes sink dramatically of late – as captured by a precipitous fall within the firm’s share value.
The inventory has plummeted virtually 97% from peaks hit two years in the past, when it had shot to fame as a part of the meme-stock craze ignited by online game retailer GameStop. The shares traded at a mere $1.55 apiece finally examine on Friday, in contrast with 2021 highs above $50.
The dramatic decline is barely the newest leg in a rare journey full of unusual twists and turns that spanned the previous two years. The inventory, which had slumped beneath $4 in 2020, skyrocketed through the meme-stock mania of early 2021 in a surge that was backed by little elementary motive.
After that, Mattress Tub & Past’s inventory has seen many sudden ups and downs however since final summer season, it has crashed seemingly with little help as the corporate struggled with a mountain of debt, excessive rates of interest and pandemic-triggered stock snags. Its market capitalization, which hit a file excessive of about $17 billion in 2013, has plunged to round $178 million presently.
Now, the clock is ticking for Mattress Tub & Past on whether or not it may well save itself from chapter.
This is a timeline of the important thing occasions which have formed firm’s turbulent journey within the inventory market over the previous two years.
January 2021: The meme-stock frenzy kicks off
Mattress Tub & Past’s inventory surged 99% in January 2021 in an explosive begin to the yr after it was pulled into the meme-stock frenzy on the again of GameStop’s brief squeeze.
Meme shares turned a red-hot matter in world markets when a military of retail merchants who mobilized themselves on Reddit’s Wall Avenue Bets discussion board drove epic rallies in shares of struggling and extremely shorted corporations. Among the many names that gained traction had been Mattress Tub & Past, AMC, BlackBerry and Past Meat.
June 2021: Mattress Tub & Past launches three new manufacturers
The retailer launched three new non-public manufacturers round mid-2021 in a bid to capitalize on shoppers’ obsession with residence enchancment through the pandemic interval that saved individuals indoors.
The brand new retailer manufacturers – Our Desk, Wild Sage, and Squared Away – all centered on the house. The launch despatched the Mattress Tub & Past inventory, then nonetheless using a wider meme-stock rally, surging some 62% in a single day.
In the identical month, shares prolonged their advance after the retailer lifted its full-year income outlook, per CNBC.
November 2021: Model rejuvenation continues
In early November of that yr, Mattress Tub & Past made a wave of bulletins together with the launch of a digital market, a collaboration with grocery big Kroger and a $1 billion share buyback plan that was forward of schedule.
The inventory surged 15% on the again of the initiatives.
March 2022: GameStop chairman reveals a $150 million stake in Mattress Tub & Past
Mattress Tub & Past’s inventory loved a powerful begin to 2022, surging 34% as GameStop’s chairman Ryan Cohen revealed he had practically a ten% stake within the firm. That made Cohen one of many prime shareholders within the residence furnishings agency.
In the meantime, the billionaire investor urged the retailer’s bosses to refocus and discover a sale of the corporate, given its slumping inventory within the months prior, gross sales declines, shrinking market worth and supply-chain points.
June 2022: The meme-stock craze dies down
Over spring and summer season of 2022, the hysteria round meme-stocks dwindled because of the Federal Reserve’s speedy interest-rate will increase aimed toward containing inflation.
By June final yr, Mattress Tub & Past’s inventory had prolonged its stoop after the retailer reported a $358 million internet loss for the primary quarter towards a weakening macroeconomic backdrop, whereas CEO Mark Tritton resigned.
On the time, one analyst labelled the corporate’s first-quarter outcomes a “dumpster hearth” that would see the enterprise finally shut down.
Shares within the agency fell 24% on the finish of June on the information, and had sunk 65% in comparison with the identical time in 2021.
August 2022: Retailer closures and mass layoffs
At the beginning of August final yr, Mattress Tub & Past’s inventory confirmed renewed indicators of life because the meme-stock motion made a comeback. Shares surged over 360% by mid-August, even after a “dumpster hearth” quarter.
Then on August 17, issues took a depressing flip after Cohen mentioned he meant to promote his whole place within the retailer. The GameStop chairman and Chewy founder revealed he had cashed out all of his inventory and choices for $189 million. Mattress Tub & Past’s inventory immediately bombed, falling as a lot as 43% in two days of Cohen’s disclosure.
By the tip of the month, Mattress Tub & Past mentioned it was closing 150 shops and slashing 20% of its workforce in a bid to chop prices. Shares of the retailer fell 21% on the day of the information, and continued to slip until year-end.
January 2023: Chapter warning
The brand new yr rang in additional troubles for Mattress Tub & Past after the retailer warned it could file for chapter. The New Jersey-based residence items firm had mentioned in an SEC submitting that there’s a “substantial doubt” in regards to the enterprise’s “skill to proceed going.”
That was after the corporate mentioned it expects gross sales to fall by greater than $600 million again in November.
The chapter warning despatched the shares sliding by greater than 22%.
February 2023: Mounting debt troubles
The previous month noticed continued weak point within the inventory, aside from a 92% single-day spike on February 6 fueled by meme-stock merchants piling into the struggling retailer. That soar did not final, and the worth of the shares shortly tanked after the corporate introduced it secured investor funding to boost over $1 billion in capital to keep away from chapter.
The inventory misplaced 50% of its worth in February as the corporate missed curiosity funds on roughly $1 billion price of bonds as its debt issues piled up.