Jan 27, 2021
Bankrupt Blockbuster joins Reddit-inspired retail rally
Explaining the options market activity driving the 'reddit rockets'
The latest nostalgia stock to jump on the Reddit rally is BB Liquidating Inc., the final remnant of bankrupt video-rental company Blockbuster.
The penny stock surged as much as 302 per cent Wednesday, adding to Tuesday’s 774 per cent spike, on volume that was 70 times the three-month average, showing that even the most retrograde of old-technology stocks isn’t immune to the ebullience of retail investors and day traders.
Blockbuster filed for bankruptcy in 2010 as competitors like Netflix Inc. eliminated the need for bricks-and-mortar video-rental stores. Only one Blockbuster store survives, in Bend, Oregon.
While equity owners typically are left with nothing in a bankruptcy, investors have flocked to such stocks before: Hertz Global Holdings Inc. soared last year after filing for Chapter 11, prompting the company to warn new investors they were all but certain to be wiped out.