The man at the center of the pandemic meme stock craze appeared online for the first time in three years – and sent GameStop shares skyrocketing Monday.
Keith Gill, better known as ‘Roaring Kitty,’ posted an image on Sunday of a man sitting forward in his chair – a meme used by gamers when things are getting serious.
The stock rose by an astonishing 119 percent at one point on Monday, and caused losses of $1 billion for so-called short sellers who have been continued to bet the video game retailer will go bankrupt.
It was a throwback to 2021 when GameStop hit the headlines for a ‘short squeeze’ on its stock. Back then, it was a video game retailer struggling to survive as consumers switched rapidly from discs to digital downloads.
Big Wall Street hedge funds were betting against it, or shorting its stock – expecting it to go bankrupt. But Gill and his fans disagreed and bought up millions of GameStop shares.
That began what is known as a ‘short squeeze,’ when those big investors that had bet against GameStop were forced to buy its rapidly rising stock to offset their massive losses.
At Monday’s opening bell it appeared that Gill had reignited that phenomenon as shares of GameStop more than doubled from Friday’s close of $17.46.
Keith Gill aka ‘Roaring Kitty’ talks about Gamestop and other stocks on his YouTube channel – back in 2021. On Monday he tweeted for the first time in three years, and Gamestock stock jumped as much as 100 percent
Keith Gill, better known as ‘Roaring Kitty,’ posted an image on Sunday of a man sitting forward in his chair. It is a meme used by gamers when things are getting serious
GameStop stock surged Monday – hitting its highet level in 18 months
They hit an 18-month high of $38.20 and even after slipping slightly they were trading 67 percent higher at 1.30pm.
‘Expect short covering in this stock’ said Ihor Dusaniwsky, from data firm S3 Partners.
He said that just an hour into trading Monday, short selling hedge funds had lost $1 billion – on paper at least.
It’s the biggest intraday trading jump for GameStop since the meme craze in 2021. Other meme stocks like the theater chain AMC were jolted higher as well.
Gill became a hero for smaller retail investors in 2021 on the back of his posts on the Reddit subcategory Wallstreetbets. The posts ignited a David vs. Goliath battle with large hedge funds that were betting heavily against the survival of GameStop, shorting its stock.
The small guys won, at least for a while, driving shares of GameStop up more than 1,000 percent in 2021, and other meme stocks as well. The struggling movie theater chain AMC jumped 2,30 percent in the same year.
And some big traders lost billions.
Citron Research, Melvin Capital and other well-known hedge funds lost an estimated $5 billion on the other side of the trade in 2021, according to analytics firm S3 Partners.
Gill and other investors in GameStop were betting, in part, on the ability of Ryan Cohen, co-founder of Chewy.com, to push the traditional retailer in a more online direction.
Cohen built up a stake in GameStop before eventually joining the board and last year becoming its CEO.
Yet it wasn’t only GameStop that caught fire Monday. Some of the same meme stocks that recorded astronomical gains back in 2021 surged as well.
AMC leapt 33 per cent. Koss, a headphone manufacturer, spiked 25% and BlackBerry, the one time dominant smartphone maker, rose 7%. The retailer Bed, Bath & Beyond, another meme stock, sought bankruptcy protection last year.
However, some meme stocks including GameStop and AMC had already been climbing higher earlier this month, and rapidly.
Shares of GameStop, which have faded steadily since 2021, had risen 57 percent this month. In January, GameStop reported its first annual profit since 2018, although it´s still unclear if Cohen´s turnaround plan will succeed.
AMC had risen 10 percent over the past 30 days.
Chart shows GameStop stock price over five days
The story of Roaring Kitty was made into a movie. This image released by Sony Pictures shows Paul Dano as Keith Gill in a scene from ‘Dumb Money’
Gill reaped a big profit investing in a troubled video-game company, but denied when he appeared virtually at a Congressional hearing that he used social media to drive up GameStop’s stock price.
He told lawmakers at the time simply: ‘I like the stock.’
As Roaring Kitty, Gill vanished from messaging boards after posting a video in June 2021 of kittens going to sleep.
The story of Roaring Kitty and the meme stock craze was turned into a movie last year called ‘Dumb Money.’