AMC, GameStop Renewed Rallies Leave Short-Sellers Scrambling

It appears that retail investors have once again renewed the rally in meme stock favourites, including GameStop and AMC Entertainment.

The latter’s shares jumped nearly 10% Thursday morning, marking the fourth day of gains for the heavily-shorted company. AMC recently surpassed a significant milestone, raising over $1 billion in financing in an effort to evade bankruptcy over the past several months. This has put the company’s market value at nearly $10 billion, as the stock is up by more than 850% since the beginning of the year.

In fact, since the movie theatre company reported its first quarter earnings on May 6, its stock has nearly doubled, increasing its value by almost $6 billion, “The Reddit crowd is strong, the volumes have been off the charts lately, so there’s clearly demand that wasn’t there pre-Covid,” Macquarie Securities analyst Chad Beynon told Bloomberg. However, the latest rally in AMC shares has also caused over $1.37 billion in market-to-market losses for short-sellers, including a loss of $290 million stemming from Wednesday’s rally.

Similarly, GameStop has also been relishing in the latest retail investor frenzy. Shares of GameStop soared over 15% to above $240 on Thursday, marking the highest level since the middle of March. This has forced some bearish short-sellers to retreat their positions, as they hurried to buy shares to cover their losses. Over the past week, approximately 958,000 GameStop shares, valued at $201 million, were purchased to cover short sales. Since the beginning of the year, GameStop short-sellers have lost a combined $6.7 billion in mark-to-market losses.

Some analysts have attributed the recent resurgence in GameStop to growing speculation that the video game retailer may be in the midst of creating a non-fungible token (NFT) platform. The latest NFT hypothesis came to light after website nft.gamestop.com posted positions for engineers, designers, and a variety of other jobs.


Information for this briefing was found via Bloomberg and the companies mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.

Leave a Reply

Video Articles

Endeavour Mining Q1 Earnings: Cash Flow Is King

G Mining Oko West Feasibility: Move Fast, Break.. Nothing?

New Gold Q1 Earnings: What’s Behind The Market’s Surprising Reaction?

Recommended

First Majestic Posts Record Cash Flows In Q1 As Production Costs Fall

Brazil Potash Secures Funding In Support Of US$2.5 Billion Autozales Project

Related News

Cineworld Declares Bankruptcy: AMC CEO Distances, Cineplex Expects Hitches On Claiming $1.24 Billion Court Judgment

British cinema chain Cineworld Group filed for Chapter 11 bankruptcy proceedings but its leading competitors...

Thursday, September 8, 2022, 10:48:00 AM

GameStop Craters On Q4 2023 Revenue Decline, Job Cuts

In a significant blow to GameStop (NYSE: GME), shares of the brick-and-mortar video game retailer...

Wednesday, March 27, 2024, 10:09:38 AM

Shorts Get Burned: The Return Of GameStop

Well slap me across the ass and call me George, GameStop is running again. Roarin’...

Tuesday, May 14, 2024, 04:21:32 PM

Village Farms: A Future “Meme” Stock?

Perhaps the biggest story in the stock market over the last week or two has...

Saturday, June 5, 2021, 09:00:00 AM

SEC Starts Investigation On Melvin Capital For The GameStop Short Squeeze

Already closed shop and planning to return money to its investors, hedge fund firm Melvin...

Friday, August 12, 2022, 03:40:00 PM