GameStop, AMC shares surge on return of Roaring Kitty

The man at the center of the pandemic meme stock craze appeared online for the first time in three years, sending prices of these bizarre and volatile stocks soaring on Monday.

Keith Gill, known as “Roaring Kitty”, posted a photo on social platform X of A on Sunday The man is sitting forward in his chairA meme used by gamers when things are getting serious.

He followed that tweet with a YouTube video from years ago, when he defended the troubled company GameStop, saying, “That's all for now, because I'm out of breath. For your information, here is a short 4 minute video I put together to summarize $GME Bull case.

Gamestop In 2021 there was one video game retailer struggling to survive as consumers increasingly switched from discs to digital downloads. Big Wall Street hedge funds and major investors were betting against it, or shorting its stock, believing that its shares would continue to decline significantly.

Gill and those who agreed with him changed the trajectory of a company that was headed for bankruptcy by buying thousands of GameStop shares in front of almost any accepted metrics, telling investors that the company was in serious trouble.

This triggered what became known as the “short squeeze”, when large investors who had bet against GameStop were forced to buy up its rapidly rising stock to recoup their huge losses.

Gill seemed to have reignited the event as GameStop shares more than doubled after Monday's opening bell. They closed up 74% on Monday. This is the biggest intraday trading jump for GameStop since the meme trend began in early 2021. Other meme stocks like theater chain AMC were also hit harder.

Trading at GameStop was halted eight times before noon on Monday due to the volatility.

Gill became a celebrity in 2021 after his posts on the Reddit subreddit WallStreetBets sparked a David vs. Goliath battle with big hedge funds who were betting heavily against GameStop's survival.

The little guys won, at least for a while, sending GameStop shares up more than 1,000% in 2021, as well as other meme stocks. Struggling movie theater chain AMC jumped 2,300% in a very short period of time that same year.

Some major traders posted huge losses as GameStop went from less than $20 to nearly $400 each. Citron Research, Melvin Capital and other famous hedge funds Damage estimated at $5 billionAccording to analytics firm S3 Partners.

Some of those new and smaller investors believed, at least in part, that co-founder Ryan Cohen could steer the traditional retailer in a more online direction. Cohen built up a stake in GameStop last year before eventually joining the board and becoming its CEO,

Joining the meme surge on Monday was AMC Entertainment Holdings Inc., which jumped 78%. Headphone maker Koss Corp. rose 37% and BlackBerry, a once-dominant smartphone maker, rose 7%. Retailer Bed, Bath & Beyond, another meme stock, sought bankruptcy protection Last year.

Some meme stocks, including GameStop and AMC, were rising even faster earlier this month.

Shares of GameStop Corp., which have been on a tear since 2021, were up 57% already this month. In January, GameStop reported its first annual profit since 2018, although it is still unclear whether Cohen's turnaround plan will succeed.

AMC Entertainment Holdings Inc. was up 10% over the past 30 days.

After Gill's tweet, there was a stir among those companies on Monday.

However, as far as companies like GameStop are concerned, the market dynamics have changed.

When Gill and an online army of retail investors began buying GameStop shares, more than 140% of the company's tradable shares were being shorted. You arrive at that distorted number because some traders were borrowing against an already shorted stock to make even bigger bets against the company, greatly increasing their losses when the stock started climbing.

Short positions against GameStop's tradable shares are now more than 24%, up slightly from the 22.5% recorded in January.

Gil made a big profit by investing in a troubled video-game company, but he denied it Attended congressional hearing virtually He used social media to increase the stock price of GameStop.

He simply told lawmakers at the time, “I like the stock.”

As Roaring Kitty, Gill disappeared from messaging boards in June 2021 after posting a video kittens are going to sleep,

It was the story of Roaring Kitty and the meme stock craze. turned into a movie Last year was called “dumb money”.

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