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GameStop stock climbs to 74% after Roaring Kitty returns with meme stock. Here's what happened
GameStop's meme stock resurgence led by Roaring Kitty saw shares soar by over 110% on Monday morning and finished the day with more than 74%.
The meme stocks are back and on the way to attaining high growth. Shares of the video game retailer GameStop suddenly reached a million-dollar high Monday because of a mysterious social media post.
Roaring Kitty, a Redditor, started GameStop’s huge meme stock short squeeze in 2021, posted on X after a three-year break, and the GameStop stock went up by about 110% .
Keith Patrick Gill, better known by his online alias Roaring Kitty, first gained widespread recognition for catalyzing GameStop's unprecedented meme stock short squeeze in 2021, before vanishing from the digital sphere.
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Why the sudden resurgence?
Now, Keith broke his three-year hiatus with a tweet on Sunday, reigniting investor fervour and propelling shares of the video game retailer to skyrocket by over 110% on Monday morning.
Trading halts occurred multiple times throughout the day; ultimately, the GameStop shares finished the day with a more than 74% increase.
The ripple effect extended beyond GameStop, as other meme stocks experienced notable gains, with AMC Entertainment soaring by 78%. Meanwhile, popular meme-coins Dogecoin and Shiba Inu saw increases of over 6% and about 5%, respectively.
Gill's emergence into the spotlight during the pandemic stemmed from his bullish analysis of GameStop shared on Reddit. His recent tweet, featuring an image depicting a focused gamer leaning forward in their chair, ignited speculation among followers about his potential return to Reddit.
The tweet was viewed by over 10 million people as of Monday morning.
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How GameStop's meme-mania started
All the individual investors who were on lockdown became conscious of the fact that GameStop's stock was on the low, and they saw the opportunity to go for it. Great financial connoisseurs such as Gill, in the online world known as Roaring Kitty and DeepFuckingValue, are the ones who exposed the reality of the stock’s undervaluation and the excessive shorting by investors.
Short-selling is the process of lending and selling stocks in order to buy them back at a reduced price and thus, the profits from the price difference are earned. Regarding the GameStop stock, on August 21, 2020, Gill in a video pointed out that it was heavily shorted, mainly by the hedge funds. He proposed that a huge short squeeze could make these funds to close their positions by buying back the shares, thus, the stock price would increase.
How was GameStop's pre-meme stock mania?
GameStop as a meme stock phenomenon reached its zenith in 2021, fueled by a coalition of small investors emboldened by the Reddit community WallStreetBets and spurred on by an endorsement from Elon Musk on Twitter, “Gamestonk.”
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This surge saw GameStop shares skyrocket from $3 to $120.
However, the path of GameStop has met obstacles since its peak in 2021, with virtual reality gaming becoming the mainstream and mobile gaming is still the leading player. The video game retailer's fourth-quarter earnings report looked dark and grim, full of bad sales figures and considerable layoffs.
