Keith Gill, a Reddit user credited with inspiring GameStop’s rally, during a YouTube livestream arranged on a laptop at the New York Stock Exchange on June 7, 2024.

Michael Nagle | Bloomberg | Getty Images

GameStop shares fell more than 16% on Monday as the meme stock extended Friday’s sell-off sparked by a dismal earnings report and an uninspiring livestream from Roaring Kitty.

The video game company’s stock declined to just below $24 apiece on Monday after falling nearly 40% on Friday alone. GameStop released its earnings report days ahead of schedule, reporting that sales dropped 29% in the first quarter. GameStop also announced it was selling an additional 75 million shares.

Meanwhile, meme stock champion Keith Gill hosted his first livestream in a few years Friday. He revealed that he did not have any institutional backers and the GameStop positions he had shared in screenshots were his only bets. Gill also reiterated his previous investing thesis and offered little new reasoning behind his large stake.

Loading chart…

Michael Pachter, GameStop analyst at Wedbush, said he remains skeptical that the company could result in any meaningful turnaround after multiple failed strategies recently.

“We cannot see how GameStop adds any value by operating any new businesses, particularly not now after its entire C-suite was either terminated or chose to depart,” he said in a note.

Pachter noted that GameStop’s prior strategy to be like Amazon was “an abject failure” as three former Amazon executives it hired to pursue the strategy left the company. Then, its plan to sell NFTs fell apart after it partnered with the now-defunct FTX, he added.

The analyst thinks that any boost GameStop got from Gill could turn out to be short-lived.

“We suspect that [Friday’s] live stream from influencer Keith Gill (Roaring Kitty) will keep shares elevated long enough to the company to complete its [at-the-market share offering], but with no clear strategy, we suspect the share price will once again begin to descend and approach our new price target,” Pachter said.

Don’t miss these exclusives from CNBC PRO

Read More: World News | Entertainment News | Celeb News

Leave a Reply

Your email address will not be published. Required fields are marked *

You May Also Like

BUSINESS LIVE: Supermarkets lead as FTSE 100 jumps 1.5%; Thames Water plots £1.1bn extra green spend; Asda profits soar

The FTSE 100 is up 1.7 per cent in afternoon trading. Among…

The Fed’s preferred inflation measure rose 0.2% in April, as expected

Inflation rose about as expected in April, with markets on edge over…

Scientists develop ultra-thin battery for smart contact lenses that could be charged by tears

Scientist Lee Seok Woo said a scene from a “Mission Impossible” movie…