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Wendy’s shares surged as much as 42% on Wednesday after a viral Reddit post sparked a new meme stock rally around the struggling fast food chain.
The stock reached an intraday high near $8.85 and triggered multiple volatility halts as trading activity accelerated.
Wendy’s later pared part of the gain but remained about 26% higher near $7.89 at press time.
The rally appeared to begin after a post on Reddit’s WallStreetBets forum urged traders to save Wendy’s before it was too late.
The post was later removed, but attention had already spread across retail trading platforms and social media.
Retail investors purchased approximately $2.3 million of Wendy’s shares during early trading, according to Vanda Research.
Trading volume surged to more than 187 million shares, far above the stock’s typical daily activity.
Wendy’s became an attractive target for speculative traders because of its recognizable brand, depressed share price and high short interest.
Roughly 34% of the company’s public float had been sold short before the rally.
A heavily shorted stock can rise rapidly when bearish investors begin buying shares to limit their losses, adding further demand to the market.
However, the move appeared largely disconnected from Wendy’s underlying business performance.
The stock had fallen sharply over the past several years and remained more than 70% below its 2021 peak before Wednesday’s surge.
Wendy’s reported that US same restaurant sales declined 7.8% during the first quarter, while global same restaurant sales fell 6.8%.
The company has been dealing with weaker customer traffic, cautious consumer spending and rising costs.
Wendy’s recently appointed Robert Wright as chief executive and Steve Cirulis as chief financial officer and chief strategy officer as part of its turnaround effort.
The rally recalls previous meme stock episodes involving companies such as GameStop and AMC, where retail traders targeted familiar brands with large short positions.
Whether the gains persist will depend on whether trading momentum continues or investors return their attention to Wendy’s sales and earnings outlook.
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English (US) ·