Shares of GameStop Corporation GME are soaring Monday with the return of one of the key figures who helped bring attention to the video game retail stock.
What Happened: After a three-year hiatus on social media platform X (formerly known as Twitter), the account of Roaring Kitty has returned with his first post since June 18, 2021.
Roaring Kitty, the online alias of Keith Gill, posted a meme of a man playing video games and leaning forward in his chair on Sunday May 12 at 8 p.m. ET. At the time of writing, the post has been viewed over 10 million times on X.
Related Link: GameStop Q4 Earnings Highlights: Retail Favorite Stock Plunges After Revenue, EPS Miss
On Monday, Roaring Kitty and the stock ticker for GameStop, $GME, are both trending on X. The stock is also trending on the WallStreetBets forum on Reddit.
Who Is Roaring Kitty?: Gill is a former financial analyst who previously worked at MassMutual. He was registered as an agent with MML Investors Services LLC, a broker dealer arm of the company.
Gill gained a following on the WallStreetBets forum positing with the username DeepF***ingValue. He also shared videos and did live streams on YouTube under the Roaring Kitty name.
"A method for hunting stocks and pouncing on investment opportunities. Live streams on Mon/Wed/Fri from 7-10pm ET. For educational purposes only," Roaring Kitty's X profile reads.
One of the stocks highlighted by Gill in a video was video game retailer GameStop. The video and idea gained steam across WallStreetBets and more retail investors got into the stock.
Gill bought $56,000 in call options that soared to tens of millions of dollars in value as GameStop's share price soared.
Related Link: GameStop’s Short Squeeze Anniversary: A Look Back At David Vs. Goliath Battle And What’s Next
Short Squeeze: Many short sellers had been betting against GameStop with the potential of bankruptcy a concern. The increased interest from retail traders like Gill prompted more hedge funds to bet against GameStop.
What happened next was a short squeeze of epic proportions, with many traders playing David to the hedge funds' Goliath. Hedge funds like Melvin Capital and Citadel struggled as the share price of GameStop soared in value.
News of the short interest of GameStop stock being over 100% led to investors seeing an opportunity to squeeze out the shorts.
One of the places where the short squeeze story gained steam was on Benzinga's "Power Hour" show, where Citron Research's Andrew Left joined to share his thesis on why he was betting against GameStop.
On Jan. 21, 2021, Left was interviewed live and the video had thousands of messages in the chat defending GameStop's future growth and why Left was wrong.
The stock rose on the day and over the next several days, leading the Benzinga interview to be one of the places considered as the "room where it happened."
Several stock brokers like Robinhood restricted the buying and selling on certain high volatile stocks like GameStop, which led to an outcry from investors.
GameStop shares hit a high of $483 on Jan. 28, 2021.
The Fallout: The events of the GameStop short squeeze led to a congressional hearing for many parties involved.
"Whether other individual investors bought the stock was irrelevant to my thesis — my focus was on the fundamentals of the business," Gill said in testimony published by the House Financial Services Committee.
Gill said at the time that he was "as bullish" as he had ever been on a potential turnaround for the struggling video game retailer.
"In short, I like the stock. And what's stunning is that, as far as I can tell, the market remains oblivious to GameStop's unique opportunity within the gaming industry."
A book titled "The Antisocial Network: The GameStop Short Squeeze and the Ragtag Group of Amateur Traders That Brought Wall Street to Its Knees" was written and released by Ben Mezrich, recalling the short squeeze storyline.
In September 2023, Sony Group Corp SONY released a movie titled "Dumb Money" based on Mezrich's book.
Actor Paul Dano played Gill in the movie and helped bring the storyline of Roaring Kitty to more people around the world.
The widely watched movie, currently available to stream on Netflix Inc NFLX, reveals that Gill didn't sell his GameStop shares ahead of the congressional hearing. He also bought more shares.
"He has since retreated from public life," the end credits read.
What's Next: With Gill returning to social media, a rally in GameStop shares has begun. The big questions are if the rally will continue and if Gill will start marking videos again or regularly posting.
Based on the surging price of GameStop shares on Monday, investors appear eager to welcome Gill back to social media and hope another huge rally in the video game stock can occur.
Gill has over 500,000 followers on YouTube and over 500,000 followers on X as Roaring Kitty giving a strong platform for his return.
GME Price Action: GameStop shares are up 83% to $31.98 on Monday. The stock previously traded in a 52-week range of $9.95 to $27.65 ahead of Monday. Shares of GameStop closed at $17.46 on Friday before Gill's weekend post.
Read Next: Ken Griffin Doesn’t Want You To See ‘Dumb Money’ Movie, Screenwriters Say That’s Why You Should
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© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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