Stocks fell suddenly Monday morning, prompting a brief halt due to volatility. The stock fell more than 15% to just $ 223.00, rebounded, and then fell even lower.
Shares of video game retailer GameStop (ticker: GME) this month have risen again near their levels at the end of January this month. At the close, GameStop shares fell 17% to $ 220.13.
The company said last week that
(CHWY) co-founder Ryan Cohen and former Chewy executive Alan Attal joined Kurt Wolf, managing member and chief investment officer of activist investor Hestia Capital Management, on a new board committee aimed at transforming GameStop in a tech business.
Cohen kicked off GameStop’s career by building a share of roughly 13% in 2020 and urged the company to turn more toward ecommerce offerings. He joined the company’s board with two associates in January, shipping Parabolic GameStop stock in the following weeks. Analysts noted speculative options activity and the closing of some aggressive bearish bets from hedge funds.
Last month, GameStop announced the planned departure of CFO Jim Bell. A person familiar with the matter told him Barron at the time the company thought the time was right and was looking for a new executive with a background in technology.
GameStop’s latest run began following a February 18 Congressional hearing on the trading of its shares and Robinhood. The audience included an appearance by Keith Gill, the YouTube personality known as RoaringKitty, who has developed a following for his successful long position in GameStop stocks dating back to 2019; Gill revealed in a Feb. 19 post that he doubled his stakes on GameStop.
While some analysts are optimistic about the company’s recovery prospects, FactSet’s highest price target is $ 33. That analyst, Joseph Feldman of Telsey Advisory Group, pointed to the valuation concerns, despite its “high fundamental expectations and projected multi-year benefits from the transformation.”
The company said it will report fiscal fourth quarter results next week. Like other stocks called memes preferred by retailers, these results pose a risk to the company’s skyrocketing. That said, trying to call a short-term high for GameStop has been foolish, especially for short sellers facing unlimited downside.
Write Connor Smith at [email protected]