GameStop stock soars as ‘Roaring Kitty’ reveals US$116M bet

globalnews.ca:

GameStop shares surged more than 70 per cent premarket on Monday after “Roaring Kitty” Keith Gill, the stocks influencer behind the 2021 retail trading frenzy, returned to Reddit with a post showing a US$116 million bet on the embattled videogame retailer.

The stock briefly doubled in value to US$46.90, with roughly US$1.1 billion worth of shares changing hands by 8:15 a.m. ET (1215 GMT), second only to the US$1.6 billion in Wall Street favorite Nvidia, according to LSEG data.

It was the first post in three years from Gill’s Reddit account, where screenshots of his bullish GameStop trades triggered a rush of demand in 2021 for “meme stocks” – often companies with weak fundamentals that gained a cult-like following through social media hype.

The screenshot posted on Sunday showed a GameStop holding of 5 million, or 1.8 per cent of its publicly available stock. Gill’s last post from April 2021, titled “final update,” showed a holding of 200,000 shares worth US$30.9 million.

Sunday’s post also revealed US$65.7 million worth of call options expiring on June 21 at a strike price of $20.

The stock wrapped up a volatile month at $23 on Friday, about 33 per cent higher since Gill began sharing cryptic posts and memes from his “Roaring Kitty” account on X.com in May, sparking speculation over whether he would resume sharing his trades online after the hiatus.

“Keith Gill is putting his money where his tweets are, and some investors are clearly following his lead and rekindling interest in meme stocks,” said Ben Laidler, global markets strategist at digital brokerage eToro.

“This is having a disproportionate share price impact given the short position in the stock combined with its relatively small market capitalisation.”

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