Meme-stocks make a comeback after Tupperware and bankrupt Yellow see shares jump more than 800%

• Meme-stocks are making a comeback as investors send shares of troubled companies higher.
• Tupperware and Yellow have both seen their share prices surge by more than 800% over the past week.
• The rallies suggest that investors are willing to take on more risk after the broader stock market moved higher.

A meme-stock rally has sent shares of Tupperware and Yellow Corporation soaring, suggesting that investors are growing more comfortable with taking on risk after the broader stock market moved higher.

While Tupperware has warned investors that it's on the verge of bankruptcy, trucking company Yellow has already filed for bankruptcy protection and shut down its operations. Both companies have seen deteriorating financials and have had limited profits over the past year.

But the immense risk of their equity being worthless hasn't scared traders out of bidding both stocks up by more than 800% over the past couple of weeks.

Shares of Yellow have surged as much as 1,062% from its July 27 low, while shares of Tupperware have jumped as much as 869% from its July 19 low.

Both rallies have occurred on little fundamental news, and instead appear to have been partly driven by a short-squeeze, in which short-sellers close out their bearish positions by buying back the stock, putting more upward pressure on the stock price.

Yellow's short interest has surged from about 8% at the start of the year to more than 12% in mid-July, while Tupperware has seen its short interest more than double from about 9% at the start of the year to about 22% in mid-July.

These rallies could be putting other short-sellers on notice and causing them to reduce their positions in order to avoid getting caught in a painful short-squeeze. Heavily shorted Rite-Aid, which had short interest above 20% in mid-July, saw its stock price soar as much as 68% on Wednesday despite a lack of fundamental news.

The resurgence in unexplainable meme-stock rallies signals that some investors are growing more comfortable taking on more risk in the market as the S&P 500 and Nasdaq 100 print strong year-to-date gains of 17% and 40%, respectively.

Despite the latest meme-stock surges, shares of Tupperware are still 73% below their 52-week high, while Yellow is 54% below its 52-week high.