Digital Services & Products

GameStop soars as ‘Roaring Kitty’ reveals $116 mln bet in Reddit post

June 3, 2024

June 3 (Reuters) – GameStop (GME.N) shares soared more than 70% in premarket trading on Monday following the return of Keith Gill, known as “Roaring Kitty,” to Reddit. Gill, the influential stock trader behind the 2021 retail trading frenzy, posted a $116 million bet on the struggling video game retailer.

By 5:53 a.m. ET (0953 GMT), GameStop shares worth roughly $390 million had traded hands, surpassing the $343 million traded in Wall Street favorite Nvidia (NVDA.O), according to LSEG data.

Gill’s post, his first in three years, included a screenshot showing a GameStop holding of 5 million shares, which is 1.8% of the company’s publicly available stock. It also revealed $65.7 million in GameStop call options expiring on June 21 at a strike price of $20. GameStop’s stock closed at $23 on Friday, up about 33% since Gill began posting cryptic messages and memes from his “Roaring Kitty” account on X.com in May, fueling speculation about his return.

“Keith Gill is putting his money where his tweets are, and some investors are clearly following his lead and rekindling interest in meme stocks,” said Ben Laidler, global markets strategist at digital brokerage eToro.

GameStop was the top trending stock on the investor-focused social media platform stocktwits.com, indicating heightened interest among individual traders. Other meme stocks also saw gains, with AMC (AMC.N) rising 26%, and Tupperware (TUP.N), SunPower Corp (SPWR.O), and U.S.-listed shares of BlackBerry increasing between 6% and 13%.

Monday’s surge put GameStop short sellers on track for nearly $1 billion in paper losses, according to Ortex Technologies.

GameStop has been struggling with declining sales as its core business of selling new and pre-owned video game discs suffers from the shift to digital downloads and game streaming.

Reuters could not verify the screenshot, and Gill did not respond to requests for comment on Reddit or via email.

Following the news, Reddit shares jumped 5.6%, and retail trader-focused brokerage Robinhood (HOOD.O) gained 3.3%.

Gill’s last post from April 2021, titled “final update,” showed a holding of 200,000 GameStop shares worth $30.9 million.

(This story has been refiled to correct the name of the website to ‘stocktwits.com’, in paragraph 7)

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