On Wednesday, shares of donut shops, camera manufacturers, and even meat suction companies saw a notable increase as the meme stock trend made a comeback.
Krispy Kreme, based in North Carolina and operating about 350 stores, saw its stock rise by 25% on the same day.
GoPro, known for its small action cameras, experienced a significant jump of 49%, which was a bit surprising considering the wider market dynamics.
After a week of tumultuous trading, shares of Opendoor Technologies—a platform for buying and selling real estate—plummeted by 18%.
Cole’s shares took a hit as well, dropping 13% after having climbed nearly 40% earlier in the week.
According to Daniela Hathorn, a senior market analyst at Capital.com, despite no substantial changes in these companies’ fundamentals, social media activity and short squeezes have been key drivers behind the current stock rally.
“Krispy Kreme looks like it’s joined the party,” Hathorn observed in a recent note.
She added, “There’s no major news that explains this spike, unlike in other instances.”
This latest surge is strikingly reminiscent of the GameStop frenzy that caused major ripples in the market four years ago, eventually leading to the closure of Gabe Plotkin’s hedge fund, Melvin Capital Management.
Similar to that early GameStop incident, the current meme stock resurgence is occurring alongside a general optimism in the broader market. The S&P 500 recently hit new all-time highs, and Bitcoin has more than doubled in value over the past year.
On Tuesday, the call volume for Krispy Kreme soared to over 100,000 contract transactions—a staggering 71 times higher than the average daily volume recorded over the last four years, according to analysis from Bloomberg.
GoPro also saw its call volume peak at over 56,000 contracts, marking the highest since 2021, as reported by Bloomberg.
Traders, particularly from Reddit’s Wallstreetbets, which has a history of influencing meme stock movements, have been pushing various companies, including Krispy Kreme, into the spotlight.
Eric Jackson, founder of EMJ Capital, noted last week that Opendoor’s shares had surged significantly, describing it as “a real business.” He believes the market has been overly negative, perhaps due to fears of substantial inventory issues or the stock reaching historic highs.
Interestingly, Cole’s stock more than doubled at one point on Tuesday.
Other stocks facing short interest, like Campbell’s Co., AEHR Test System, Polaris, and Wendy’s, also caught the attention of traders this week.
