A college student cashed out a $110 million profit on Bed Bath & Beyond after piling $25 million into the meme stock
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A college student made a $110 million profit on Bed Bath & Beyond stock this week.
Jake Freeman's fund disclosed a 6.2% stake in the retailer in late July, then sold it on Tuesday.
Bed Bath & Beyond, the latest meme stock to skyrocket, has more than tripled in value this month.
A 20-year-old college student raked in an estimated $110 million profit by selling Bed Bath & Beyond shares this week, capitalizing on the home-wares retailer becoming the latest meme stock to multiply in value in a matter of days.
Jake Freeman, the head of Freeman Capital Management, disclosed that he owned almost 5 million Bed Bath & Beyond shares, or 6.2% of the company, in a Securities and Exchange Commission filing on July 21. He sold the entire position on Tuesday, he disclosed in another filing this week.
Bed Bath & Beyond stock more than tripled in price from under $6 to over $20 during that period, as retail traders piled in hoping it would skyrocket in value like GameStop, AMC, and other meme stocks. Freeman spent about $25 million on his stake, or less than $5.50 a share, and sold it for north of $130 million on Tuesday, the Financial Times reported.
"I certainly did not expect such a vicious rally upwards," Freeman told the newspaper. "I thought this was going to be a six-months-plus play," he continued, adding that he was "really shocked that it went up so fast."
Freeman is an applied math and economics major at the University of Southern California, and he copublished a paper titled "Irreducible Risks of Hedging a Bond With a Default Swap" at the age of 16. He told the FT that he has invested alongside his uncle for years, previously interned at a hedge fund named Volaris Capital, and mostly raised the money for his Bed Bath & Beyond bet from friends and family.
He appears to have lucked out with the timing of his sale. Bed Bath & Beyond stock fell as much as 19% on Wednesday after Ryan Cohen, the retailer's largest shareholder and GameStop's chair, disclosed that he intended to dump his entire 12% position in the company.
Bed Bath & Beyond shares had spiked on Tuesday after Cohen confirmed he still held bullish call options on the stock. Cohen helped spark GameStop's surge in January 2021 — and he kick-started the wider meme-stock boom — by investing in the video-game retailer and pushing for changes at the company.
Freeman didn't immediately respond to a request for comment from Insider.
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