GameStop shares (GME) soared as much as 75% on Monday after user “DeepF***ingValue” on Reddit, an account believed to be linked to individual investor Keith Gill — who fueled the 2021 meme stock rally — posted a screenshot posted to Reddit late Sunday, showing they had built a nearly $175 million position in the video game retailer.
Gill is also known as Roaring Kitty on X and YouTube. The user posted the screenshot to Reddit’s Superstonk subreddit on Sunday evening.
The screenshot showed 5 million GameStop shares purchased at an average price of $21.274, a position worth $115.7 million as of Friday’s closing price of $23.14. GameStop shares traded at $38 each in early trading Monday before being temporarily halted due to volatility.
The account also appears to own 120,000 options contracts that expire on June 21. These contracts give the right to buy GameStop shares for $20 each, a position worth $65.7 million at Friday’s close.
Monday’s premarket spike comes after GameStop soared 180% in the span of two days in mid-May following “Roaring Kitty” posted for the first time on X, formerly known as Twitter, since 2021.
Last month’s rally was short-lived, as analysts warned that the meme action this time around was a far cry from the level of 2021 retail inflows.
Still, GameStop benefited from May’s rally. Last month, the company sold 45 million shares, generating about $930 million in proceeds. The stock rose 25% after the news.
Typically, investors expect the stock price of a company that issues new shares – diluting the value of current assets – to fall after a share sale.
“If this were a normal market, people would be a little panicky,” Interactive Brokers chief strategist Steve Sosnick told Yahoo Finance last week after the news.
“You don’t sell shares in the market if you think your shares are undervalued. You do it if you think your shares are overvalued.”
AMC (AMC) also benefited from the meme frenzy, raising $250 million last month through the sale of 72.5 million shares. AMC shares also rose Monday, gaining 30% in early trading.
Ines Ferre is a senior business reporter for Yahoo Finance. Follow her on X @ines_ferre.
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