What Is GameStop, the Company, Really Worth? Does It Matter? The New York Times
Left of Citron Research made the announcement in a YouTube video, saying Citron Capital let go of the majority of their bets that GameStop stock would fall and took a “100%” loss in doing so. Gill also posted screenshots of his GameStop portfolio on r/wallstreetbets as far back as 2019. Gill and other members of the forum also cited the bullish GameStop stance of Michael Burry, the legendary trader who was portrayed by Christian Bale in the 2015 film “The Big Short,” as fuel for their investment choices. “We are excited to bring our customer-obsessed mindset and technology experience to GameStop and its strategic assets,” Cohen said in a statement at the time.
- Earlier that day the share price had soared to nearly $350 (£250) times more than this time last year.
- A company worth $1.3 billion on the stock market on New Year’s Eve was worth about $21 billion at the end of last week, roughly the same as Kellogg’s, the cereal maker, which, unlike GameStop, is solidly profitable.
- A series of users on the Reddit forum r/Wallstreetbets noticed that GameStop was (a) undervalued by the market and (b) vulnerable to a short squeeze.
- GameStop has not formally confirmed its next earnings publication date, but the company’s estimated earnings date is Tuesday, March 19th, 2024 based off prior year’s report dates.
It is also a Hollywood dramatization of something quite complicated — not just because markets are complicated, but because reality is. Wall Street types are pretty meh on the whole episode — one hedge funder I recently talked to told me the idea that the big guys are afraid when retail is in a stock is silly. Some GameStop traders may have won a temporary battle, but institutional https://broker-review.org/ investors are still winning the war. Even the stories of some of the traders Dumb Money was based on, and who I talked to for this story, are far from cut and dried. As the tug-of-war between the everyday investors and hedge funds heated up and support grew for GameStop on r/wallstreetbets, the stock skyrocketed more than 50% in the trading session on Jan. 22.
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The same goes for everyday investors — some won, some lost, and plenty were just in it for the casino-like ride. Wall Street is paying more attention to individual investors than it used to, but they’re not keeping CEOs up at night, either. And many of these retail investors are looking at “meme” stocks such as GameStop. Earlier that day the share price had soared to nearly $350 (£250) times more than this time last year. For one thing, the volume of trading has strained the computer infrastructure of online brokerages, including TD Ameritrade, which said Wednesday that its mobile app was handling unprecedented volumes.
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A lot of people are crowing that this is giving large hedge funds and traders a taste of their own medicine. As the share price rose and rose, more people bought in – both to trigger the short squeeze, and because the price itself was now a way to make money. GameStop’s low share price, thanks to the shorters, made it relatively easy for a large number of people to buy in with little money. Some bought in believing in the stock, others because they thought it was funny – GameStop was easily memed thanks to many Reddit users’ fond memories of the chain.
J Acquired Geeknet, Inc. (“ThinkGeek”), a United States-based online and wholesale Pop Culture retailer. G Acquired Simply Mac, Inc. (“Simply Mac”), a United States-based Apple specialty store retailer. They borrow shares in the company and sell them, with a promise to buy them back at a later date. You’ve probably stared blankly at your WhatsApp chat as the words “GameStop”, “Reddit” and “stock market” get thrown around the way “pub” and “meet at 8” used to. Former CFO Diana Saadeh-Jajeh — who described herself as a “decision maker for key business strategies including NFT, digital wallet, and crypto initiatives” at GameStop — also resigned in August 2022. Please enter a city, address or postal code to view information pertaining to your local store.
And far from being a failing, bricks-and-mortar gaming company, it is well placed to move into the digital space, where even a small part of the market would make it hugely valuable. White House press secretary Jen Psaki said Wednesday that the Biden administration’s economic team was “monitoring the situation” around trading in GameStop. There’s no evidence that any of this is illegal, although Nasdaq CEO Adena Friedman has said stock exchanges and regulators need to pay attention to the potential for schemes fueled by social media.
I don’t think many people are going to walk away from Dumb Money eager to download an investing app and start playing the markets. (Plenty of people have already been doing that anyway.) But the level of triumphalism in the movie is a lot. Regular people playing the stock market is fine if that’s what they want to do, but to play the Wall Street game isn’t to overthrow pepperstone review it. Most retail investors are in it to try to make money, not remake the system, and most don’t even do that. GameStop investors are in awe when their holdings go up (on paper), but Roaring Kitty’s followers proclaim to be “diamond hands,” meaning they don’t sell. At some point, Robinhood limits trading on GameStop, a move that many to this day see as questionable.
GameStop Takes With Katie Baker. Plus: Super Bowl Hype!
In February, the prevailing attitude on Wall Street was the share price was slowly finding its natural position. GameStop shares may move by about 20 percent a day through March if options trades are an indication, Barron’s reported. And some skeptics point to the situation around GameStop and other companies as evidence that the stock market has reached a dangerous level of enthusiasm and speculation. And while WSB had gotten some media attention in recent days for its GameStop boosterism, a boom in coverage of GameStop and WSB helped bring the story out of the financial world and more into the mainstream. The internet has been used to prognosticate about stocks for decades, but there’s never been anything quite like the Reddit community called r/wallstreetbets, also known as WSB. A lot of sentiment on r/Wallstreetbets celebrates the fact that the rush on GameStop is no different from the dotcom bubble, the property bubble, or strategic drops in the traditional financial media.
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Increased volume can indicate a short squeeze, meaning people who had bet against the stock either chose or were forced to give up and take losses. Amateur investors on WSB have discussed GameStop (which they refer to by its stock ticker abbreviation, GME) for years, but things changed early this year. “100% of my portfolio on GME because of you idiots,” a person posted Jan. 10. On Wednesday, the people who run WSB temporarily made the community private and said they were “experiencing technical difficulties based on unprecedented scale as a result of the newfound interest in WSB.” F Acquired Free Record Shop Norway AS (“Free Record Shop”), a Norway-based record store retailer operating 49 stores. The normie GameStop investors who recognized the opportunity for a short squeeze were right — the stock was over-shorted, they saw their chance, and they seized it.
Of course, any hype online or on social media would raise a share’s price, but without the low entry price or the short squeeze, those extreme multiplier factors aren’t there. This exact scenario also can’t apply to other stocks that don’t have a significant percentage of short sellers, or that aren’t down in the dumps. For example, Reddit could not coordinate the same thing on Apple shares. For others, it is a form of wealth transfer – the only losers in this trade are large hedge funds, and the winners are lower-income internet users, some of whom are only putting up a few thousand dollars.
Upgrade to MarketBeat All Access to add more stocks to your watchlist. She feels tied to the GameStop community (though she now frequents the message boards less) and is sure the company has plans, though she’s not sure what they are. And hey, maybe the Mother of All Short Squeezes (MOASS) that some of GameStop’s most diehard fans are still holding out for will pan out. “Part of me is like, if it’s going to the moon, I’m not going to give up my seat, I’ve got my tickets,” she said. “The way the platform works is the content gets served to you based on how many upvotes it has.
In a July 27, 2020, YouTube video posted to his channel, Gill said, “Some people won’t even tune into the stream right now when they hear I’m bullish on GameStop, at the current price point it’s traded at about four bucks right now.” Attal was the former chief marketing officer at Chewy, and oversaw its rapid expansion from three people to more than 10,000 employees. Grube was the formerly the chief financial officer at Chewy, among other executive roles in the e-commerce space. Cohen is the founder and former chief executive of the e-commerce platform Chewy and one of the largest shareholders in GameStop through the private firm he operates, RC Ventures.
Hi Shelley, you and more than $6bn of lost hedge fund money are asking the same question. “In this sort of Wall Street bets culture, people take screenshots of how much money they’ve made or lost to kind of show off,” he said. “And as they sort of advertised that, people started piling into the trade and the momentum built.” The stock market drama has been called a “David and Goliath” battle. Most of the traders who have been piling into the stock are likely chasing easy profits, and probably do not care whether GameStop’s strained business could make a miraculous turnaround. The frenzy for the troubled retailer’s stock has been a head-scratcher for the analysts who try to determine a company’s value.
The company received significant media attention during January and February 2021 due to the volatility of its stock price in the GameStop short squeeze. The company is now ranked 577th on the Fortune 500.[3] GameStop also owns and publishes the video game magazine Game Informer. Amateur or small retail investors with their ‘dumb money’ are playing the real game on Reddit under a community named wallstreetbets or WSB, against the well-established ‘wall streeters’. The term dumb money is used for small individual investors who are expected to lose against the market analyst, traders who trade in stocks for their living. Like most stores that still sell products in person, it has had a hard time lately as video game sales have moved online and as the Covid-19 pandemic keeps people away from stores.
“CAN’T STOP WON’T STOP GAMESTOP,” a person wrote Jan. 14, along with a clip from the movie “The Wolf of Wall Street.” GameStop was one of the most shorted of all publicly traded companies. Other companies on the list include AMC Theatres, Bed Bath & Beyond and even the mostly defunct Blockbuster. But GameStop was the perfect target, and many of these other stocks are not as shorted nor as popular. Stonk is essentially just a funny way to say “stock” – and once you understand that, it explains everything else that has happened. The meme itself started circa 2017 with this absurdist, funny cartoon and it has now become the default lingo of r/Wallstreetbets.
Head David In Charge is Keith Gill/Roaring Kitty/DeepFuckingValue, played by Paul Dano, the GameStop devotee who found himself at the center of the 2021 storm after months of posting videos about his belief in the stock. Dumb Money plays some of Gill’s real-life hits, including one video where he jokes about dipping a chicken tender — a nod to Redditspeak where “tendies” indicate market gains — into a glass of champagne as GameStop’s price rises. And, the theory goes, many retail investors used their cheques to invest in the stock market. Massachusetts regulator William Galvin compared the situation Wednesday to the 1999 tech stock bubble. “The current pandemic has created a unique situation where many people who have gotten into day-trading really have no idea exactly what they’re doing,” he told CNBC. Mike Novogratz, an investor and former hedge fund manager, said the internet activity is the result of frustration that everyday investors are often locked out of lucrative opportunities, such as initial public stock offerings.
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