GameStop Storms 110% Toward Best Day Since 2021 On Return Of Meme Stock Folk Hero ‘Roaring Kitty’

by 24britishtvMay 13, 2024, 9 p.m. 27
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GameStop shares skyrocketed Monday as the brick-and-mortar video game retailer once again enjoyed a bump from retail investors celebrating the return of meme stock celebrity “Roaring Kitty" – whose wordless social media post drove the beleaguered company's stock price up more than 100% at one point.

Keith Gill, best known for captaining the 2021 day trader campaign against institutional investors betting on GameStop’s demise, posted on his X account “Roaring Kitty” for the first time since June 2021 on Sunday evening, uploading a picture without text of a man leaning forward in his gaming chair, a popular meme indicating a user is reengaging or locking back into a subject. Despite the post including no text or context, Gill’s former cronies on retail investor online communities such as Reddit’s WallStreetBets celebrated his return to the public eye, with posts on Reddit accumulating tens of thousands of likes, comparing Gill’s potential reemergence to that of the messianic protagonist in the popular “Dune” book and film series. The retail investor groups appeared to put their money where their memes were, as GameStop’s stock rallied massively Monday despite no catalysts to the business other than the Roaring Kitty post, gaining 110% shortly after market open, sending shares from $17 to $37, settling into a more modest 70% gain by mid-afternoon. That’s GameStop’s highest intraday share price since Aug. 2022, thanks to what would be the stock’s biggest single-day gain since Feb. 2021, though the stock was halted several times during the first hour of trading. It’s still a far cry from the 135% gain GameStop shares registered on Jan. 27, 2021 at the height of meme stock mania, when GameStop traded at almost $100 per share.

The 37-year-old Gill is best known for his 2019-21 posts on Reddit’s WallStreetBets social media platform, which he has yet to return to, a community which shot up in popularity as COVID-19 stay-at-home orders and stimulus checks unlocked a new class of investors. Gill’s rise from mundane life to rival of hedge fund billionaires like Steve Cohen and Ken Griffin was immortalized in the 2023 film “Dumb Money,” portrayed by actor Paul Dano. GameStop shares are more than 70% below their 2021 peak, but the stock remains exponentially higher than its sub-$1 share price for much of 2019 and 2020, notching a sustained victory that eluded other meme stocks like Bed Bath & Beyond, which went bankrupt last spring, and AMC Entertainment, which faces bankruptcy rumors as its shares sit 99% below their 2021 high.

The stock surge did help GameStop tidy its books, with its $1.2 billion in cash and equivalents and its $603 million in debt last quarter far healthier than the $587 million in cash and $1.2 billion in debt it held at the end of 2020. But the rest of GameStop’s income statement shows little evidence of a company whose stock should have the sort of sustained rally like GameStop’s, as the gaming firm’s $5.3 billion in revenue and $17 million net profit last year was far below its $9 billion in revenue and $354 million profit scored a decade earlier. Yet, GameStop shares trade about three times higher than they did a decade ago. The reason for that depends on who you ask: Skeptics would say it’s unsustainable as the market always catches up to a company’s inherent value, while the largely retail investor base backing GameStop would argue it’s evidence a stock is simply worth what people are willing to pay.

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