Shares of GameStop and AMC each soared by more than 100% in early trading Tuesday as the surprise return of the retail day trader known as “Roaring Kitty” sparked a flurry of meme stock activity for the second straight day.
GameStop spiked as much as 113% in early trading and was still up about 64% shortly after the market opened.
That pushed the beleaguered video game retailer’s stock price up to nearly $50 per share – a once-unthinkable number given the company’s recent financial performance.
AMC’s stock was up as much as 129% and was up about 78% after the opening bell to surpass surpass $9 per share.
On Monday, the company revealed it had raised approximately $250 million in a stock sale.
Both struggling firms benefited from the bombastic return of Roaring Kitty, whose real name is Keith Gill and who also uses the moniker “DeepF—kingValue” on Reddit.
Gill, who was immortalized in the 2023 film “Dumb Money,” is best known as one of the voices who prompted the so-called “Reddit Rally” of 2021, in which retail traders squeezed short-sellers who placed bets that the two companies could go bust.
The renewed frenzy in the “trash stocks” had Wall Street experts shaking their heads.
“The only environment where GameStop and AMC and the likes of BlackBerry and other, I would say, trash stocks, would succeed is in an environment where anything and everything can go higher,” Longbow Asset Management CEO Jake Dollarhide told The Post.
“What we’re seeing lately with new market highs and the Dow being up nine days in a row, we’re seeing the festering of another meme-stock rally,” he added.
Gill, 37, teased followers with several X posts Monday, including a popular meme of a man leaning forward in his chair with a video game controller and a series of clips from popular TV shows and movies such as “Breaking Bad” and Marvel’s “Avengers.”
A former employee at Massachusetts Mutual Life Insurance, Gill hadn’t posted in roughly three years and had essentially gone off the grid.
“The fact that Roaring Kitty is back should be totally meaningless to the stock market (but) the fact that it isn’t is fascinating,” said Matthew Tuttle, CEO of Tuttle Capital Management.
Short sellers were set to lose $1.2 billion on paper on Tuesday, slightly more than Monday’s losses, analytics firm Ortex Technologies said.
GameStop has rallied even after the company reported lower fourth-quarter revenue in March and said it would slash an unspecified number of jobs as part of a cost-cutting push.
Credit: Source link
