Shares of GameStop and AMC each soared more than 100% in early trading Tuesday, as the sudden return of the retail day trader known as “Roaring Kitty” fueled meme stocks for the second day in a row.
GameStop soared 113% in early trading and was still up about 64% after the market opened.
That pushed the struggling video game retailer’s stock price to nearly $50 a share, a number that was once unthinkable given the company’s recent financial performance.
AMC’s stock price rose as much as 129% and was up about 78% after the opening bell to more than $9 per share.
The company said Monday it had raised about $250 million from a stock sale.
Both struggling companies benefited from the much-hyped return of Roaring Kitty, whose real name is Keith Gill and who goes by the nickname “DeepF—kingValue” on Reddit.
Gill, immortalized in the 2023 film “Dumb Money,” is best known as one of the people behind the so-called “Reddit Rally” of 2021. At the rally, retail traders squeezed short sellers who had bet on the profits of both companies. You may go bankrupt.
The new craze for “trash stocks” has Wall Street experts shaking their heads.
Jake Dollarhide, CEO of Longbow Asset Management, said: “The only environment in which GameStop and AMC and BlackBerry and other trash stocks can succeed is when everything is “It’s an environment that could go up,” he told the Post.
“While we have seen recent market highs and a nine-day streak of gains for the Dow, we are once again seeing the rally in meme stocks worsen. ” he added.
Gill, 37, on Monday posted a popular meme of a man leaning forward in a chair holding a video game controller, as well as a series of clips from popular TV shows and movies such as “Breaking Bad” and Marvel’s “The Avengers.” and teased his followers with several X posts. ”
Mr. Gill, a former Massachusetts Mutual Life Insurance employee, had not held a post for about three years and had essentially quit his job.
“The fact that Roaring Kitty is back should mean nothing to the stock market, but it’s interesting that that’s not the case,” said Matthew Tuttle, CEO of Tuttle Capital Management.
Short sellers are expected to incur a paper loss of $1.2 billion on Tuesday, slightly more than Monday’s loss, according to analysis firm Ortex Technologies.
GameStop is also rebounding after the company reported a decline in fourth-quarter sales in March and announced an unspecified number of layoffs as part of cost-cutting efforts.
