William Simpson
GameStop shares jumped more than 72% on Monday after trader Keith Gill, known online as “Roaring Kitty,” resurfaced four years after leading an investment frenzy involving the video game retailer.
Gill is a former MassMutual financial analyst who in late 2020 encouraged amateur retail investors to buy GameStop shares during the meme stock craze. He did this by posting on Reddit discussion forums and creating YouTube videos about the strategy, gaining a large following in the process. But in 2021, Gill revealed that he had lost $13 million in one day of its investments in GameStop.
Gill was also sued in 2021, accusing him of profiting from “deceptive and manipulative conduct” in promoting GameStop shares. After appearing before Congress To explain the meme stock craze, Gill’s social media presence dwindled to non-existence.
He reappeared on X, Sunday night, with a image of a man drawn leaning forward in a chair, marking the end of a gap of approximately three years. He followed that post with several others featuring several comeback-themed videos, with movie clips and songs uploaded.
GameStop did not immediately respond to a request for comment from CBS MoneyWatch on Monday.
GameStop was one of four struggling companies, including AMC, Bed Bath & Beyond and Blackberry, that retail investors on Reddit embraced financially during the pandemic, in a dual effort to keep the lights on at these companies as well as to put a “short squeeze” in hedge funds that bet against your long-term success.
GameStop experienced declining sales amid an industry-wide shift from game cartridges to video game streaming and digital downloads, but with the help of meme stock investors last March, the company made its first profit in two years. Before that, the company had recorded seven consecutive quarterly losses. In January of this year, GameStop reported its first annual profit since 2018.
Roaring Kitty’s post helped drive GameStop’s share price to $28.25 on Monday. GameStop’s highest share price was $120.75 in January 2021. Shares of AMC and Bed Bath also rose slightly on Monday.
Last September, GameStop named Chewy founder Ryan Cohen as its new CEO. In its most recent quarterly results in March, GameStop said it eliminated an unspecified number of jobs to help reduce costs. The Texas-based company reported revenue of $1.79 billion, compared to $2.23 billion the year before.
