GameStop's shares fell by 20 percent on Friday after the video game retailer revealed plans for a share sale aimed at raising up to $3 billion.
This news came as a surprise to investors, especially ahead of a highly anticipated livestream by meme stock influencer Keith Gill, also known as "Roaring Kitty."
According to Reuters, the company reported its quarterly results four days earlier than scheduled, coinciding with Gill's YouTube announcement of a livestream at 12 PM ET on Friday.
GameStop announced it would sell up to 75 million shares but did not provide further details on the timing of the capital raise or the reason for the early earnings release.
In 2021, Gill's support for GameStop fueled a stock rally that saw prices soar by as much as 1,600 percent before a sharp decline. His influence garnered a cult following among some investors and scrutiny from others, leading to congressional and regulatory attention.
After facing intense scrutiny, Gill disappeared from the public eye but has recently resurfaced, reigniting interest in GameStop.
While the 2021 mania around GameStop was part of a broader Reddit-fueled retail investor backlash against short sellers, the current euphoria around the stock smacks more of opportunism, according to Interactive Brokers chief strategist Steve Sosnick.
“There was a huge us-versus-them mentality to the whole thing,” Sosnick told InvestmentNews in a recent interview. “This has a very different character to me. I don’t know who ‘them’ is. If it’s us versus them, you need a ‘them.’”
That lack of zealotry could be part of the reason behind the volatile character of this latest bout of GameStop mania.
On Thursday, GameStop shares surged nearly 50 percent, coinciding with activity from an account on X linked to Gill that drove investors to a frenzy. Since May 13, GameStop shares have climbed nearly 150 percent, according to Reuters.
The stock was trading at $36.95 just before the livestream, experiencing several trading halts due to volatility.
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