BUG: Bounding Box much larger than text

5 years later, I'm having this exact same issue. Actually, I've had two different variations of this issue. After many cuss words and desperate pleas on forums, I've finally solved my issue through trial and error and thought I would share on this thread. Both times I've had this issue, the problem started with a selected item thats bounding box was WAY bigger than it should've been. Most of the advice on forums including resetting the bounding box, deleting and undeleting the probelm selection, and resetting my preferences didn't work.

In the first case, any time I moved the selected item, it would randomly move other parts of my design, even though they weren't grouped. I tried ungrouping, regrouping, cursing at the screen etc. The solution in this case was CHECK FOR HIDDEN GUIDES! Turn on your guides and make sure you are not grouping them with anything. (view > guides > show guides, remove anything grouped to your design by mistake) 

The SECOND time I had this issue, I thought I already knew what was going on, but after turning on the guides, there were none on the document. I found this thread, which described my exact issue but again, none of the provided answers solved my problem. I finally figured out the solution - I have yet to figure out the root cause. (This specific logo causing this issue was on a document that was sent to me, so I'm not sure how this problem was initiated.)  I ungrouped my selection, right-clicked each component one by one, and selected "release clipping mask." Immediately each problem component went back to normal bounding constraints. I then highlighted the whole area again, found the invisible selection, (an empty box) deleted it, and regrouped the logo. 

I hope this helps!!!

For my part you are welcome, Sebastian.

I have experienced this many times on windows and mac even on the most recent version , to avoid this I used to press ctrl + E ( preview on cpu/gpu) or close/reopen the document.  

Sebastian,

If you move the folder and the file to wherever else (you can store them in a new folder in Preferences) or even just rename them, instead of deleting them, you can always move them back or rerename them if the issue persists. It is easier to find them in a new folder under their right names; you can even have different versions in subfolders to safely develop your preferences with the option of going back.

Then no harm will have been done.

I have never seen anything like what you are describing with any version of Illustrator. Try trashing your Illustrator preferences and see if the problem persists when the program is restored to its defaults.

To do so on a Mac:

The User Library folder in which Illustrator’s preferences are stored is hidden by default on most Macintoshes. To access it make sure that Illustrator is closed and click on the desktop to launch a Finder Window (Command-N).With this window in column view follow the path User>Home folder (it’s the folder with an icon that looks like a house—it may have the user’s name rather than “Home”) and click on the Home folder. With the Option Key pressed choose Library from the Finder Go Menu. “Library” will now appear within the Home folder. Within the Library folder find the folder called Preferences and within it find the folder called “Adobe Illustrator <Version #> Settings” (earlier versions of Illustrator might just say “Adobe Illustrator”) and the file called “com.adobe.Illustrator.plist” and delete both that folder and that file. When Illustrator is next launched it will create new preference files and the program will be restored to its defaults.

The advantage of manually deleting preference files in this manner is that after you’ve reset up the program (make sure that no document window is open) to your liking, you can create copies of your personalized “mint” preference files (make sure that you quit the program before copying them—that finalizes your customization) and use them in the future to replace any corrupt versions you may need to delete.