Roaring Kitty Skewers GameStop Stock Soars After Latest Losses

Video game retailer GameStop posted a significant rebound on Wednesday, closing up 22.8% after two straight days of heavy losses. This follows last week’s surge following the recent return of influencer Roaring Kitty (aka Keith Gill).

After a rough start to the week, shares of GameStop plunged more than 8% in early trading Tuesday. However, it surged late in the day and showed an impressive reversal. This recovery can be attributed to a number of factors, including the completion of major stock offerings and changes in market sentiment.

Meanwhile, Roaring Kitty continued to poke fun at herself and her ongoing developments, despite losing about $350 million on her GME position from last Thursday until the close of business on Monday.

He shared a meme on Twitter on Tuesday showing a character watching an “Options Basics 101” course, seemingly pinching himself over the loss of his papers. Roaring Kitty has not yet shared the latest disclosures about her portfolio, including the value of her own option holdings, as of this writing. However, we are confident that there will be a significant increase due to rising prices.

Impact of stock offering

On Tuesday, GameStop announced that it had completed its previously public ATM (marketplace) stock offering program. The Company sold the maximum number of shares enrolled in its ATM program, generating approximately $2.137 billion in total proceeds.

GameStop plans to use the net proceeds of this offering for general corporate purposes, which may include acquisitions and investments. This successful stock offering significantly strengthened the company’s financial position, increasing its cash reserves to over $4 billion and contributing to the rapid recovery of its stock.

GameStop’s stock surge was met with a mix of surprise and enthusiasm across social media and trading platforms. More than 136 million shares were traded on Tuesday, fueled by a resurgence in the stock from retail investors, fueled by the recent comeback of Roaring Kitty, who had accumulated a large GME options position.

Additionally, analysts at S3 Partners noted that a significant amount of short squeeze activity occurred, likely triggering a sharp price increase. This occurs when investors who have bet against a stock are forced to buy shares to cover their positions, causing the price to rise further.

Broader market trends may also have influenced GameStop’s stock movements.

Wall Street was relatively flat as investors remained cautious in anticipation of the upcoming inflation report and Wednesday’s Federal Open Market Committee (FOMC) meeting.

The S&P 500 fell about 0.2%, its weakest daily performance this month. But the tech-heavy Nasdaq 100 held steady, helped by a strong surge in Apple after it unveiled a new AI product on Monday.

Editor: Andrew Hayward