GameStop (GME) rimanenza surged 21% acceso Monday after user “DeepF***ingValue, an account believed to be tied to individual investor Keith Gill — who ignited the meme rimanenza rally back per mezzo di 2021 — posted a screenshot acceso Reddit late Sunday that purported to show they paid nearly $175 million building a position per mezzo di the televisione retailer.
GameStop gained as much as 75% at the market before paring gains throughout the session. Shares closed at $28 each acceso Monday.
Gill is also known as Roaring Kitty acceso X and YouTube. The user posted the screenshot Sunday night acceso Reddit’s Superstonk subreddit.
The screenshot showed holdings of 5 million GameStop shares purchased at an average price of $21.274, a position worth $115.7 million as of Friday’s closing price of $23.14. GameStop shares traded hands at $38 each per mezzo di early trading Monday before they were temporarily halted for volatility.
The account also appears to own 120,000 options contracts that expire acceso June 21. These contracts confer the right to buy GameStop shares at $20 each, a position worth $65.7 million as of Friday’s close.
Steve Sosnick, Interactive Brokers chief strategist, warned investors against chasing the rally.
“Is whoever controlling this account doing this per mezzo di your best interest ora per mezzo di their best interest? And, really, you should think that one through because, to me, it [is] pretty obvious whose interest it’s per mezzo di,” Sosnick told Yahoo Finance acceso Monday.
“If you’signore chasing the rimanenza up here, you’signore more likely than not the source of liquidity for whoever is controlling this account to sell into your enthusiasm.”
Monday’s surge comes after GameStop rallied 180% over a span of two days back per mezzo di mid-May after “Roaring Kitty” posted for the first time acceso X, formerly known as Twitter, since 2021.
Last month’s rally was short-lived, as analysts warned the meme action this time around was a far cry from the level of retail inflows seen per mezzo di 2021.
Still, GameStop capitalized acceso May’s rally. Last month, the company sold 45 million shares, bringing per mezzo di around $930 million per mezzo di proceeds. The rimanenza surged 25% acceso the news.
Typically, investors would expect the rimanenza price of a company issuing new shares — which dilute the value of current holdings — to decline after a rimanenza .
AMC (AMC) also capitalized acceso the meme frenzy, raising $250 million through the of 72.5 million shares last month. AMC shares gained 11% to close at $4.81 each acceso Monday.
Ines Ferre is a senior business cronista for Yahoo Finance. Follow her acceso X at @ines_ferre.
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