GameStop shares rocket as Roaring Kitty returns

No need to check your calendar. It’s not 2021. But the reason for the surge was the same as the year the retailer became the first meme stock: An individual investor who goes by the name Roaring Kitty.

Keith Gill, who has been silent on social media for the past three years—and whose evangelism for GameStop shares led to a massive run-up in the stock—posted an image Sunday. And that was enough to mobilize the meme stock army.

The volatility led to trading in the stock being halted several times early Monday. In mid-morning trading, GameStop was up 86% at $32.50 after soaring as high as $38.20 intraday.

The image showed a man sitting forward in his chair, a meme that gamers often use when things get serious. The post was followed up by a YouTube video lionizing GameStop that was made many years ago.

Gill has not resumed posting on Reddit, where he was an oft-followed member of r/WallStreetBets.

Shares are still well below their 2021 peaks, when the price reached as high as $483, but they were approaching 52-week highs a few minutes after trading opened. Year to date, GameStop shares are up more than 60%. That’s despite reporting fourth-quarter earnings at the end of March that were far below analyst expectations and revenues of just $1.79 billion, nearly $500 million less than the year before.

The return of Gill, who was the inspiration for the film Dumb Money, throws a hand grenade into analyst projections, though. And his loyal fans celebrated his return.

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Just as with the last run-up in GameStop stock, some buyers appear to be targeting short sellers, who have been betting against the company. Analytics firm Ortex said the stock’s price gain has resulted in short sellers losing over $800 million since the beginning of May.

The bigger question, of course, is whether investors have the patience for a true meme stock rally this time around. The last time Gill led the charge on GameStop, most retail investors were working from home as the pandemic kept them away from work. Many have presumably returned to the office at this point, which could interfere with their trading habits.

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