0
0
GameStop Stock Plummets 16% Following Short Seller Announcement
GameStop Corp. faced a 16% drop in its stock on Wednesday after a prominent short seller announced it would be abandoning its position. The short seller, Citron, made the announcement in a post on X, stating that they were no longer short on $GME and acknowledging the market’s irrationality.
“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,” Citron mentioned. This move comes after GameStop recently raised $2 billion from a share sale, intending to use the funds for general corporate purposes, acquisitions, and investments.
The Impact of “Roaring Kitty”
Keith Gill, an investor known for his social media persona “Roaring Kitty,” has been a central figure in GameStop’s stock volatility. The company’s shares have experienced significant fluctuations, driven by its meme stock status, with online communities closely following its movements.
Last week, GameStop shares plummeted by 40% following Gill’s return to YouTube after a three-year hiatus. Citron, having suffered losses during GameStop’s previous meme stock frenzy, criticized Gill’s livestream, calling it “an insult to the capital markets.”
Gill had previously disclosed holding 120,000 GameStop call options set to expire on June 21. Citron, however, expressed caution, stating that while the increased share count might dampen the hype, they would continue to observe the situation from the sidelines.
Future Outlook
Despite the recent downturn, GameStop remains a stock to watch as it navigates the challenges posed by market speculation and investor sentiment. The company’s ability to leverage its financial resources and engage with its loyal base will be critical in shaping its future performance.
Image/Photo credit: source url
