GameStop’s Win Streak Keeps Going Amid Cohen Shakeup Plan
(Bloomberg) -- GameStop Corp. extended its recent resurgence in premarket trading after more than doubling in a week, with day traders piling back into the company that started the meme stock craze earlier this year.
The shares rose as much as 20% before paring some of those gains. They traded at $283 as of 5:41 a.m. in New York, up from Tuesday’s close, though still a long way from the Jan. 28 intraday record of $483. Shares in other stocks favored by day traders, including AMC Entertainment Holdings Inc., retailer Express Inc. and headphone maker Koss Corp. also rose in premarket trading.
GameStop is back on the radar of retail investors as Chewy Inc. founder and activist investor Ryan Cohen continues to shake up operations at the video-game retailer. The Grapevine, Texas-based company said Monday Cohen would lead a new committee focused on its digital transformation.
“It looks like the second wave of bullish speculation has clearly kicked off,” Ipek Ozkardeskaya, senior analyst at Swissquote, said by email. “Given the massive volatility in this stock, the risk is huge as the rally in the GME stock price is boosted by expectations of future growth, and is not based on concrete results for now.”
Retail investors’ Reddit-driven surge has kept its shares afloat despite the broader market’s recent volatility and tech selloff.
The frenzy has drawn U.S. regulators to consider adding rules for everything from options trading to short-selling. In letters to Senator Elizabeth Warren, the Securities and Exchange Commission and the Financial Industry Regulatory Authority said they’re reviewing potential rules to fix regulatory gaps.
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