(Jan 6): Bed Bath & Beyond Inc, once a meme-stock darling during the mania that captivated investors a couple of years ago, is now flirting with penny-stock territory as the company teeters on the brink of bankruptcy.

KeyBanc Capital Markets analyst Bradley Thomas slashed his 12-month share-price target for the retailer to 10 cents from US$2 after the company said it might not be able to continue as a going concern. The average price projection among brokerages tracked by Bloomberg stands at US$1.96, though that figure will likely come down as analysts adjust their models following the company’s update.

The shares tumbled 30% Thursday to US$1.69, the lowest level in more than 30 years. They’re down 97% from a recent peak of US$52.89 in early 2021, when day traders fuelled furious rallies in meme stocks like GameStop Corp, AMC Entertainment Holdings Inc and Bed Bath & Beyond.

To Thomas, the value for equity investors has all but evaporated.

“Creditors are in the best position to realise value from assets such as Buybuy Baby,” he wrote in a research note, referring to Bed Bath & Beyond’s baby brand.

Wells Fargo Securities analyst Zachary Fadem also cut his price target for Bed Bath & Beyond to US$1 from US$2 Thursday, saying that a bankruptcy filing could be imminent. Thomas and Fadem both have sell-equivalent recommendations for Bed Bath & Beyond, as do the majority of analysts tracked by Bloomberg.

The company also post weaker-than-expected preliminary sales Thursday. It is scheduled to report third-quarter earnings next week.