GameStop surges another 70% before trading was halted
GameStop (NYSE: GME) has done incredibly well for itself for the past couple of months. After years of falling sales and otherwise a struggling business model, the company’s fortunes turned around after it was taken over by an activist investment fund determined to transform the business. Whether or not it’s going to do that remains to be seen, but since then, investors have been euphoric about GameStop. However, there have been short-sellers jumping on the company as well. GameStop shot up substantially just before the weekend after one well-known short-seller, Citron Research, said it wouldn’t be commenting on the company anymore.
Citron had originally planned to do a YouTube video in which they would explain some reasons GameStop would see its stock plummet soon. However, the short-seller has said that it has received numerous hacking attempts from what it’s called an “angry mob” of people from certain online investment communities.
“What Citron has experienced in the past 48 hours is nothing short of shameful and a sad commentary on the state of the investment community,” Citron’s head Andrew Left wrote. “We will no longer be commenting on GameStop, not because we don’t believe in our investment thesis, but rather the angry mob who owns this stock has spent the past 48 hours committing multiple crimes that I will be turning over to the FBI, SEC and other governmental agencies.”
As it turns out, it seems that members of an online investment community, which were fanatically bullish on GameStop, were the ones responsible for the hacking attempt. Since then, shares of GameStop ended up being halted on Friday shortly, before trading once again. It’s an incredibly wild story, but it goes to show just how emotional traders can be, especially those that don’t take a professional, impartial mindset when it comes to their trading.
Shares of GameStop jumped as much as 70% on Friday before the stock was finally halted. Once things returned to normal once again, GameStop’s stock ended up still 51%. Over the past two weeks alone, shares have shot up by more than 300%, making the struggling gaming retailer one of the best performing companies so far in 2021.
Despite the new management and this activist fund restructuring the company, most Wall Street analysts remain incredibly skeptical about the company’s chances. Physical retail chains are struggling, and whether or not GameStop will succeed in the eCommerce world remains to be seen.
GameStop Company Profile
GameStop Corp is a U.S. multichannel video game, consumer electronics, and services retailer. The company operates across Europe, Canada, Australia, and the United States. GameStop sells new and second-hand video game hardware, physical and digital video game software, and video game accessories, mainly through GameStop, EB Games, and Micromania stores and international e-commerce sites, including www.gamestop.com, www.ebgames.com.au, and www.micromania.fr. The company has two main business segments: Video game brands and Technology brands. The technology brands segment sells wireless products and services and operates Spring Mobile managed AT&T and Cricket Wireless branded stores, along with the Simply Mac business. – Warrior Trading News
