Shares of GameStop, AMC skyrocket after meme stock trader posts for first time in 3 years

Shares of GameStop, AMC skyrocket after meme stock trader posts for first time in 3 years

The return of social media that surprised traders that helped fuel the meme stock frenzy in 2021 sent GameStop shares soaring on Monday. The jump had nothing to do with the company’s troubled fundamentals — and everything to do with a cartoon a player the trader, nicknamed Roaring Kitty, shared on X.

GameStop shares jumped 74% on Monday after an account run by Keith Gill shared the meme on X, marking its first post in three years. The stock soared more than 110% earlier and was halted due to volatility several times on Monday morning.

Short sellers saw $1 billion in mark-to-market losses betting against GameStop on Monday, according to data firm S3 Partners. Short sellers aim to make a profit on stocks by borrowing stocks, selling them and returning them after buying them at a lower price.

Shares of AMC Entertainment, another meme stock, rose 78%. Reddit shares are up about 9%. Shares of trading platform Robinhood Markets, which suspended purchases of GameStop, AMC and other meme stocks during the frenzy in 2021, rose 4%.

The image Gill posted depicts a man reclining in a chair with a video game console in hand. GameStop posted the same cartoon in February, but with blue arrows and chairs. In Gill’s cartoon, they are red. The meme is interpreted to convey, “when things get serious,” according to Know Your Meme.

Gill did not immediately respond to CNN’s request for comment.

Shares of GameStop tripped multiple circuit breakers — temporary halts and mandates in trading to give investors a moment of peace. Robinhood denied claims on social media on Monday that it had once again stopped buying GameStop stock on its platform.

“This is not right. Robinhood has not closed the purchase of Gamestop shares,” Robinhood spokeswoman Anupriya Ghate said in a statement to CNN. “GME saw high volatility and movement, which triggered market-wide exchange trading limits and halts. This is market-wide and not specific to Robinhood.”

Who is Roaring Kitty?
Gill, who goes by “Deepf—-ingvalue” on Reddit, is one of the main forces on the WallStreetBets subreddit driving the impressive returns in GameStop stock. Traders bid up the retailer’s stock, targeting short sellers.

Retail investors sent other stocks soaring in 2021, including AMC Entertainment and Bed Bath & Beyond. They are now collectively known as meme stocks, or stocks of companies with cult followings that see wide swings based on their popularity among the trading community on social media rather than their fundamentals.

Gill described himself as a casual day trader in testimony during a 2021 Congressional hearing on GameStop mania. He said he’s not trying to help fuel the GameStop frenzy and instead believes the stock is an attractive opportunity for investors.

“The idea that I used social media to promote GameStop stock to unwitting investors is absurd,” Gill said in written testimony. “I am very clear that my channel is for educational purposes only. … Whether other individual investors bought the stock is irrelevant to my thesis.”

Gill also said that he first bought GameStop shares, and later call options, in the summer of 2019, when the shares were trading around $5 each. He added to his position throughout the year and 2020, and testified that he believes “the market remains unaware of GameStop’s unique opportunity.”

But he also doesn’t believe it will hit a high of $483 a share in 2021.

“At the time I thought it was possible but a very low probability,” Gill testified.

Gill is the main character in the 2023 film “Dumb Money” (played by actor Paul Dano), which depicts the events leading up to and during the GameStop short game.

As the stock settles down after the trading day, levels may change slightly.

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