GameStop Stock Soars 150% in New York and 240% in Frankfurt Trading as WSB Drama Continues

By Adriaan Brits Thursday, February 25, 2021

GameStop (GME) stock closed more than 100% higher on Wednesday after another aggressive short squeeze took place.

A GameStop building sign.

WSB Stages Another Squeeze

GameStop stock exploded in January when retail investors, active on Reddit’s “WallStreetBets” forum, started buying shares of companies where short-selling hedge funds were the target. Trading of the stock was halted numerous times on the online trading company Robinhood, forcing it to raise additional funds to bolster its liquidity.

The GameStop share price went from around $20.00, what it traded for in December, to an all-time high of $483 set on January 28. The price action then returned to the $30 to $40 mark before yesterday’s rally sent the GME stock to $91.71.

GameStop stock is trading over 50% higher in pre-open trading Thursday as the buying frenzy continues. Similarly, shares of the company listed on the Frankfurt stock exchange exploded 240% today to reflect high buying interest noticed in New York yesterday.

A trigger for another buying wave of GameStop stock was the resignation of the company’s Chief Financial Officer (CFO) Jim Bell, who will leave the video retailing business on March 26.

“Mr. Bell’s resignation was not because of any disagreement with the Company on any matter relating to the Company’s operations, policies or practices, including accounting principles and practices,” the company said in a filing with the Securities and Exchange Commission (SEC).

However, a report in Business Insider noted that Bell didn’t leave the company willingly but was rather pushed out by Ryan Cohen, co-founder of Chewy, who invested in the video game business last year. This report was confirmed by Bloomberg, with the financial media outlet reporting Bell was ousted to pave the way for a quicker business turnaround.

In a memo sent to the bank’s clients, Jefferies analyst Stephanie Wissink sided with the company and downplayed media reports.

“We acknowledge that leadership changes often follow activist settlements and Mr. Bell’s exit was mutual, non-immediate, and suggests no disagreements with the company/board. We believe Mr. Bell deserves recognition for a series of actions that protected GME equity during the late stages of the last hardware cycle, when sales were down sharply,” she said.

Echoing the same business scenario from a month ago, shares of AMC Entertainment closed over 18% in the green yesterday, in addition to a further 16% of gains made in pre-market trading Thursday.

Summary

GameStop stock exploded yesterday in New York trading, as well as in today’s trading session in Frankfurt, signaling another buying frenzy as retail investors continue to target short-selling hedge funds.

About the Author


Headshot of Adriaan Brits

An analyst of global affairs, Adriaan has an MSC from Oxford, with diverse interests in the digital economy, entertainment, and business. He is a specialist trainer in advanced analytics and media.

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