GameStop (GME) raised almost $2.14 billion as it capitalized on the recent stock rallies spurred by the online reemergence of influential retail trader Keith Gill.
The video game retailer said on Tuesday it completed the sale of 75 million shares, an offering announced last Friday hours before Gill, known by his online aliases “Roaring Kitty” and “Deep F***ing Value,” went live on YouTube for the first time in three years.
On Wednesday, the heavily shorted stock gained 8%.
The stock has been on a roller-coaster ride over the past month as Gill, known for his bullish videos and posts that helped spur the meme frenzy of 2021, reemerged across social media platforms.
The level of enthusiasm for GameStop from retail traders this time around hasn’t matched that of three years ago, according to inflow data tracked by Vanda Research.
GameStop stock attracted $18 million worth of purchases last Monday as the stock surged following a post from Gill showing a massive position in the stock. By comparison, the stock’s peak inflow reached $87.5 million on Jan. 27, 2021.
“I still think that it’ll be hard to draw as large a crowd as in 2021. These flows are likely coming from a small subset of loyalists,” Vanda Research senior vice president Marco Iachini told Yahoo Finance on Monday.
On Wednesday, Citron Research, led by founder Andrew Left, announced it is no longer short GameStop after it was revealed the veteran short seller had a position in the stock last week.
“It’s not because we believe in a turnaround for the company fundamentals will ever happen, but with $4 billion in the bank, they have enough runway to appease their cult like shareholders,” read Citron’s post on X.
Three years ago, Citron was forced to sell its short position in GameStop at a loss as an army of retail traders bought the stock.
Citron is no longer short $GME. It’s not because we believe in a turnaround for the company fundamentals will ever happen, but with $4 billion in the bank, they have enough runway to appease their cult like shareholders. Despite Wedbush setting an $11 target today, we respect the…
— Citron Research (@CitronResearch) June 12, 2024
Shorting involves borrowing shares for a fee in order to sell them in the market and buying them back for a profit when the price goes down.
Short interest on GameStop currently sits at almost 22% of the float.
“We believe that high-frequency institutional traders are front-running retail’s efforts, and performance data demonstrate that this is indeed not turning into a widespread bullish phenomenon for the meme stocks cohort,” wrote Iachini.
The meme frenzy revival began last month, when GameStop rallied 180% over a span of two days after Roaring Kitty posted for the first time on X, formerly known as Twitter, since 2021.
Meme peer AMC (AMC) has also been volatile, and that company also raised capital by selling stock last month.
On Wednesday, shares of the cinema operator were flat.
Ines Ferre is a senior business reporter for Yahoo Finance. Follow her on X at @ines_ferre.
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