Key Insights
- GameStop shares surged over 37% premarket after “Roaring Kitty” Keith Gill posted online for the first time since the 2021 meme stock frenzy.
- Gill’s posts on Reddit rallied amateur traders to punish hedge funds shorting GameStop, causing a historic short squeeze.
- While the frenzy has faded, GameStop’s stock has risen recently amid renewed social media interest, despite financial challenges.
NEW YORK (MarketsXplora) – Shares of GameStop Corp GME.N surged more than 37% in premarket trading on Monday after Keith Gill, the investor known as “Roaring Kitty” who helped spark the 2021 meme stock frenzy, posted online for the first time in nearly three years.
Gill, whose posts on Reddit’s WallStreetBets forum rallied a legion of amateur traders to pile into GameStop’s shares, shared an image on the social media platform X of a gamer hunched intently over a controller – his first post since the epic short squeeze in early 2021.
— Roaring Kitty (@TheRoaringKitty) May 13, 2024
The former insurance marketer’s involvement helped fuel a rebel investor campaign that year to punish hedge funds that had shorted GameStop’s shares, expecting the brick-and-mortar video game retailer’s stock price to fall.
As the so-called “meme stock” mania went viral, GameStop’s share price skyrocketed from just $17.25 at the end of 2020 to an intraday peak of $120.75 on Jan. 28, 2021 on a split-adjusted basis, inflicting billion-dollar losses for short sellers like Melvin Capital.
The unprecedented volatility roiled financial markets, prompting brokerages like Robinhood to restrict trading in GameStop and sparking lawsuits, Congressional hearings and even a Hollywood movie about the saga called “Dumb Money.”
While the frenzy has long since subsided, GameStop’s shares have regained some ground in recent weeks, rising 57% so far in May to close at $17.46 on Friday amid renewed interest from investors on social media. The stock traded as low as $9.95 last month.
Read also! GameStop raises $2.1 billion in stock sale amid revived meme rally
However, GameStop’s fundamentals remain challenged as the company posted lower revenue of $1.79 billion for its most recent quarter amid rising competition, and implemented unspecified job cuts to reduce costs.