GameStop surges another 50% premarket as grand battle continues
Jan. 25, 2021 7:00 AM ET GameStop Corp. (GME) By: Yoel Minkoff, SA News Editor 11 Comments
The "retail bros" that have propelled stocks like legacy photo giant Kodak and bankrupt rental company Hertz to dizzying heights have a new favorite: GameStop (NYSE: GME). Shares of the video game retailer are up another 50% premarket as an epic run and battle between investing (gambling?) forces continues. The stock, which was trading near $20 just two weeks ago, is now set to open near $100.
Backdrop: On Jan. 11, GameStop popped on the investing radar after the company added some new directors to collectively bring deep expertise in e-commerce, online marketing, finance and strategic planning. That included Chewy co-founder Ryan Cohen and two former colleagues after he pushed the company to better focus on digital sales. A battle then ensued between short-selling firm Citron Research and speculative buyers organizing on Reddit's popular WallStreetBets.
Play-by-play: "This is a failing mall-based retailer," Citron's Andrew Left said in a video, but the stock buying just kept going. He later said that buyers at these elevated levels are "the suckers at this poker game," but the traders just doubled down, racking up losses for anyone left holding a short position. In fact, more than 194M shares of GameStop changed hands on Friday, more than eight times its 30-day trading volume average of 23.8M, and triggered four separate trading halts.
While the retail bros might have won the battle, can they win the war? |
