Tupperware has debt of $700 million.Scott Olson/Getty Images
Tupperware might be the latest meme stock after more than tripling in value within a week.
The troubled food storage brand is battling sliding sales and a $700 million debt mountain.
But redditors on popular trading groups are bigging up the stock and boasting about their stakes.
Tupperware is in trouble. Mired in debt, fighting sliding sales, and a share price in freefall, the brand established by Earl Tupper in 1946 looks to be on its last legs.
However, it seems a few investors didn’t get the memo.
Shares in the embattled food container maker more than tripled since July 20 to just over $3, leaving many to wonder whether it might be the latest “meme stock.”
According to data from Marketwatch, 27% of Tupperware shares that are available to trade have been “shorted” by investors.
But some speculators who borrowed shares expecting them to fall further have now been caught out by the surge. That’s forced some to buy more shares to reduce their losses, sending the price even higher.
The amount of short interest in Tupperware has indeed fallen more than a quarter this year amid apparent interest from retail investors.
There were rumblings last week that Tupperware might be attracting more interest from retail investors, after its stock initially began moving following a report in the Orlando Business Journal about an investment from BlackRock.
On July 21, when Tupperware shares were worth 90 cents, a member of the subreddit r/pennystocks, which has 1.9 million members, argued in favor of the stock’s “incredible upside potential.”
The user, who claimed to own 2,000 shares in Tupperware, said that in a high inflationary environment, households were likely to buy more food storage containers as a means of reducing their spending.
In recent years, “short squeezes” for low-value stocks have rarely been driven by the company’s actual financial performance, which is usually why they’re close to worthless in the first place.
Indeed, Neil Saunders, managing director of retail for the…