AMC Entertainment Holdings Inc AMC and Bed Bath & Beyond Inc BBBY are at it again. The pair of retail darlings are soaring Monday on no apparent news.
Jim Cramer weighed in on the meme-stock moves Monday on CNBC's "Squawk Box."
"AMC, I think that was Adam Aron coming on our show and saying listen we're doing this APE preferred and it is absolutely not dilutive," Cramer said.
AMC announced a special dividend of AMC Preferred Equity last week. The company said it will give one AMC Preferred Equity unit for each share of AMC Class A common stock held at the close of business on Aug. 15. The dividend is expected to be paid on Aug. 19.
"That really got that stock going," Cramer said. "And then once you get those stocks going, then people are looking for the mother of all shorts."
Bed Bath & Beyond stock is leading the charge higher Monday. Shares of the struggling retailer were up nearly 50% at last check. However, the company is in need of a credit line, Cramer said.
Bed Bath & Beyond is exploring private credit opportunities in order to boost liquidity and slow its cash burn, according to a Bloomberg report. Bed Bath & Beyond's management team reportedly consulted with lenders about a potential new asset-based credit line last week, according to people with knowledge of the talks.
Cramer suggested such is the result of poor management, warning investors of what could come next.
"I didn't like the fact that they bought so much stock back ... if I were Bed Bath, I'd be offering stock here," Cramer said.
Cramer noted that the wild stock swings in the market are being driven by retail traders. There's no regulatory authority slowing them down, he added.
"It is just the Wild West. It's really incredible," Cramer said.
AMC, BBBY Price Action: At press time Monday, AMC Entertainment was up 13.48% at $25.11 and Bed Bath & Beyond was up 37.13% at $11.19.
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