GameStop increased 13% more with ‘Reddit Army’ bets on sales recovery

(Reuters) – “Meme” flagship stock, GameStop, jumped another 13% in value on Friday, building on an increase since results earlier this week that showed online sales improving and a pace of increased reshuffle highly praised management.

The video game retailer, whose shares reached $ 483 in a battle with short sellers in January, has now risen more than five times in value since it hit a $ 38.50 per share low in mid-February.

It was trading for around $ 190 mid-morning, but was still down about 5% in the week after the company pointed to the possibility of a stock sale in its earnings report on Tuesday.

“It’s fascinating because it looks like Reddit’s army is doubling up and believing that the company will be able to change its business and pivot to e-commerce,” said Edward Moya, senior market analyst at OANDA.

The company benefited from a boost from retail investors, often on online forums like Reddit’s popular WallStreetBets, to raise stock prices they believed were undervalued.

The stake sold in GameStop fell to about 15% of the stock float, from a peak of 141% in the first week of 2021, according to data from financial analysis firm S3 Partners.

Chewy Inc co-founder Ryan Cohen is trying to turn the retailer into an e-commerce company that may face rivals from major stores, such as Target Corp and Walmart Inc.

Chief Financial Officer Jim Bell left and the company said this week that it had appointed former Amazon.com executive Jenna Owens as chief operating officer.

“The hiring of Jenna Owens is viewed in a very positive light, as GameStop is now becoming the vanguard and having leadership that can help transform the company,” said Moya of OANDA, adding that the stock price is still likely ” will have a strong consolidation ”in the next two months.

The main Wall Street indices took a roller coaster ride in March, as a jump in US government bond yields led to a liquidation of riskier assets. [.N]

GameStop, which added three new directors, including Cohen, to the board in January as part of a deal, said in its annual regulatory document here on Tuesday that it expects eight board members to retire at the 2021 annual meeting in June .