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Bed, Bath & Beyond shares fall after investor Ryan Cohen reveals intent to sell stake

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Signs mark a Bed Bath & Beyond store in Somerville, Massachusetts.

Brian Snyder | Reuters

Bed Bath & Beyond shares tumbled in extended trading Wednesday after activist investor Ryan Cohen said in a filing he intends to sell his entire stake in the retailer through his firm RC Ventures.

According to a Form 144 that was filed with the Securities and Exchange Commission, RC Ventures proposed selling 9.45 million shares of the company, which is the total amount it holds in Bed Bath. A Form 144 acts an official notice of a proposed security sale.

Representatives for RC Ventures and Bed Bath didn’t immediately respond to CNBC’s request for comment.

The aggregate purchase price of the 7.78 million shares directly owned by RC Ventures is roughly $119.4 million, excluding brokerage commissions, according to earlier SEC filings. And the aggregate purchase price of the firm’s call options exercisable into 1.67 million shares owned directly by RC Ventures is about $1.8 million, also excluding those commissions.

Call options give a buyer the right, but not the obligation, to purchase stock at a set strike price. Cohen’s options were for strike prices of $60, $75 and $80.

If Cohen hypothetically managed to sell all of his Bed Bath common stock at Wednesday’s closing price of $23.08, he’d net about $60 million, according to a CNBC calculation.

Cohen first revealed he held a nearly 10% stake in Bed Bath through his activist firm in early March. FactSet says his holdings amounted to 11.82% as of late March.

At the time, Cohen, the GameStop chairman and founder of Chewy, wrote a letter to Bed Bath’s then-CEO, Mark Tritton, saying he believed the home goods chain was struggling to reverse market share declines and navigate supply chain woes. He also urged the retailer to consider selling its Buybuy Baby chain.

Later in March, Bed Bath said it struck a deal with the activist’s firm to add three people chosen by Cohen to its board of directors, effective immediately.

Just three months later, Bed Bath abruptly replaced Tritton as CEO in June, naming restructuring expert and independent director Sue Gove as his interim successor. This came after the company suffered another quarter of sluggish sales and heavy losses.

More recently, Bed Bath has been facing liquidity issues, its coffers drying up ahead of the holiday season and during the back-to-school and back-to-college selling periods.

Bed Bath reported roughly $108 million in cash and equivalents in its fiscal first quarter, down from $1.1 billion a year prior. Its net losses swelled to $358 million from a loss of $51 million in the same period in 2021.

Still, the meme stock craze has found new life in recent weeks, and Bed Bath has been the primary beneficiary. As of Wednesday’s close, the stock was up 58% so far this year, easily outpacing the broader market.

Shares of the home goods retailer are up more than 300% in August alone, with heavy trading volume. The stock saw trading of nearly 400 million shares on Tuesday and another 249 million shares on Wednesday, according to FactSet.

Bed Bath has also been far and away the most mentioned stock on Reddit’s Wall Street Bets page over the past week, according to third party data provider Quiver Quantitative.

On Wednesday, after news of Cohen’s filing began to surface, users took to the Wall Street Bets page to emphasize that the Form 144 is only meant for giving notice about a proposal to sell.

User “foyerhead” said: “Ryan Cohen did not sell. FORM 144 is the ‘right’ to sell. It does not mean you are selling or have sold. If you own 10% or greater of a company, you have to file the form giving you the right to sell within the next 90 days.”

User “DeadSol” wrote: “Of course he didn’t sell. He’s an ape like us.”



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Ford CEO says 65% of U.S. dealers agree to sell EVs

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Ford F-150 Lightning trucks manufactured at the Rouge Electric Vehicle Center in Dearborn Michigan.

Courtesy: Ford Motor Co.

DETROIT – About 65% of Ford Motor’s dealers have agreed to sell electric vehicles as the company invests billions to expand production and sales of the battery-powered cars and trucks, CEO Jim Farley said Monday.

About 1,920 of Ford’s nearly 3,000 dealers in the U.S. agreed to sell EVs, according to Farley. He said roughly 80% of those dealers opted for the higher level of investment for EVs.

Ford offered its dealers the option to become “EV-certified” under one of two programs — with expected investments of $500,000 or $1.2 million. Dealers in the higher tier, which carries upfront costs of $900,000, receive “elite” certification and be allocated more EVs.

Ford, unlike crosstown rival General Motors, is allowing dealers to opt out of selling EVs and continue to sell the company’s cars. GM has offered buyouts to Buick and Cadillac dealers that don’t want to invest to sell EVs.

Dealers who decided not to invest in EVs may do so when Ford reopens the certification process in 2027.

“We think that the EV adoption in the U.S. will take time, so we wanted to give dealers a chance to come back,” Farley said during an Automotive News conference.

Ford’s plans to sell EVs have been a point of contention since the company split off its all-electric vehicle business earlier this year into a separate division known as Model e. Farley said the automaker and its dealers needed to lower costs, increase profits and deliver better, more consistent customer sales experiences.

Farley on Monday also reiterated that a direct-sales model is estimated to be thousands of dollars cheaper for the automaker than the auto industry’s traditional franchised system.

Wall Street analysts have largely viewed direct-to-consumer sales as a benefit to optimize profit. However, there have been growing pains for Tesla, which uses the sales model, when it comes to servicing its vehicles.

Ford’s current lineup of all-electric vehicles includes the Ford F-150 Lightning pickup, Mustang Mach-E crossover and e-Transit van. The automaker is expected to release a litany of other EVs globally under a plan to invest tens of billion of dollars in the technologies by 2026.



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Tim Draper predicts bitcoin will reach $250,000 despite FTX collapse

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Tim Draper, founder of Draper Associates, onstage at the Web Summit 2022 tech conference.

Ben McShane | Sportsfile via Getty Images

Venture capitalist Tim Draper thinks bitcoin will hit $250,000 a coin by the middle of 2023, even after a bruising year for the cryptocurrency marked by industry failures and sinking prices.

Draper previously predicted that bitcoin would top $250,000 by the end of 2022, but in early November, at the Web Summit tech conference in Lisbon, he said it would take until June 2023 for this to materialize.

He reaffirmed this position Saturday when asked how he felt about his price call following the collapse of FTX.

“I have extended my prediction by six months. $250k is still my number,” Draper told CNBC via email.

Bitcoin would need to rally nearly 1,400% from its current price of around $17,000 for Draper’s prediction to come true. The cryptocurrency has plunged over 60% since the start of the year.

Digital currencies are in the doldrums as tighter monetary policy from the Fed and a chain reaction of bankruptcies at major industry firms including Terra, Celsius and FTX have put intense pressure on prices.

FTX’s demise has also worsened an already severe liquidity crisis in the industry. Crypto exchange Gemini and lender Genesis are among the firms said to be impacted by the fallout from FTX’s insolvency.

Last week, veteran investor Mark Mobius told CNBC that bitcoin could crash to $10,000 next year, a more than 40% plunge from current prices. The co-founder of Mobius Capital Partners correctly called the drop to $20,000 this year.

Nevertheless, Draper is convinced that bitcoin, the world’s largest cryptocurrency, is set to rise in the new year.

“I expect a flight to quality and decentralized crypto like bitcoin, and for some of the weaker coins to become relics,” he told CNBC.

What is DeFi, and could it upend finance as we know it?

Draper, the founder of Draper Associates, is one of Silicon Valley’s best-known investors. He made successful bets on tech companies including Tesla, Skype and Baidu.

In 2014, Draper purchased 29,656 bitcoins confiscated by U.S. Marshals from the Silk Road dark web marketplace for $18.7 million. That year, he predicted the price of bitcoin would go to $10,000 in three years. Bitcoin went on to climb close to $20,000 in 2017.

Some of Draper’s other bets have soured, however. He invested in Theranos, a health startup that falsely claimed it was able to detect diseases with a few drops of blood. Elizabeth Holmes, Theranos’ founder, has been sentenced to 11 years in prison for fraud.

‘The dam is about to break’

Draper’s rationale for bitcoin’s breakout next year is that there remains a massive untapped demographic for bitcoin: women.

“My assumption is that, since women control 80% of retail spending and only 1 in 7 bitcoin wallets are currently held by women, the dam is about to break,” Draper said.

Crypto has long had a gender disparity problem. According to a survey conducted for CNBC and Acorns by Momentive, twice as many men as women invest in digital assets (16% of men vs. 7% of women).

“Retailers will save roughly 2% on every purchase made in bitcoin vs dollars,” Draper added. “Once retailers realize that that 2% can double their profits, bitcoin will be ubiquitous.”

Payment middlemen such as Visa and Mastercard currently charge fees as high as 2% each time credit cardholders use their card to pay for something. Bitcoin offers a way for people to bypass the middlemen.

However, using the digital coin for everyday spending is tough, since its price is very volatile and the coin is not widely accepted as currency.

“When people can buy their food, clothing and shelter all in bitcoin, they will have no use for centralized banking fiat dollars,” Draper said.

“Management of fiat is centralized and erratic. When a politician decides to spend $10 trillion, your dollars become worth about 82 cents. Then the Fed needs to raise rates to make up for the spend, and those arbitrary centralized decisions create an inconsistent economy,” he added. Fiat currencies derive their worth from their issuing government, unlike cryptocurrencies.

Meanwhile, the next so-called bitcoin halving — which cuts the bitcoin rewards to bitcoin miners — in 2024 will also boost the cryptocurrency, according to Draper, as it chokes the supply over time. The total number of bitcoins that will ever be mined is capped at 21 million.



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Three pharmaceutical stocks were top performers last week

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