(Bloomberg) -- Steve Johnson bought shares of Bed Bath & Beyond Inc. expecting a GameStop Corp.-like trading frenzy. Having pocketed some profit, the top-performing Australian fund manager is sticking with the stock for its long-term prospects.Forager Funds Management Pty Ltd. invested in the home-goods chain in mid-January as the Reddit-fueled short squeeze on GameStop was starting to unfold, said Johnson, Forager’s chief investment officer.“We saw what was going with GameStop and it was fairly obvious that it was another candidate for similar action,” Johnson said of Bed Bath & Beyond. “That squeeze was simply a catalyst for us to accelerate what we probably would have done, and we got lucky and made some short-term profit out of something that we think is going to be a good long-term investment.”His Sydney-based Forager International Shares Fund, which invests in a wide range of beaten-down stocks, has gained 32% over the past year and is beating 96% of peers.Short sellers have targeted Bed Bath & Beyond as it aims to transform its business in the wake of activist pressure. The firm’s revamp of its management team and focus on online sales could help it return to growth, Johnson said.The stock has almost halved since a peak in late January. The company posted a lower-than-expected gain for total enterprise same-store sales, a key metric, in the quarter ended Nov. 28. On the bright side, web sales surged 94% on a comparable basis at the namesake brand. The shares closed 4.7% higher on Wednesday in New York.Johnson’s also invested in companies that have gone public through special-purpose acquisition firms, including magazine publisher-turned licensing firm PLBY Group Inc. and industrial services provider APi Group Corp., a top holding in the A$218 million ($171 million) fund.In addition, Johnson is focusing on U.K. shares, given that market is “incredibly under-invested,” he said. The fund holds Lloyds Banking Group Plc on expectations that the lender will perform well over the next four to six years.(Adds Bed Bath & Beyond share performance in sixth paragraph.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.