It seems big movers have come to the party following the short-sellers making moves in GME stock.
Things are moving quite rapidly for GameStop Corp. (GME) as the stock has soared over130% from the prior closed price—taking GME to its all-time high. As we write this, GME is trading around $118.71 up by 59%.
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GME stock made its first big bullish move following the appointment of Chewy’s Ryan Cohen as the member of GameStop’s board along with two other Chewy executives. But there have been some other bulls keeping the stock on a roller coaster ride.
What’s happening around?
On Friday, GME stock soared over 51% following the short-seller Citron Research stated that it would not be going live stream to discuss GameStop’s price falling to $20. Citron pulled out of the stream due to hacking threats on Twitter.
On Jan. 14, GME stock was trading around $17.25 and closed at $65.01 on Friday, Jan. 22. As of today, GME has touched its all-time high of $159.19—but it traded there for a short time.
In this month, GameStop shares have skyrocketed to 600%–alone. While it is up by a whopping 800% in the last three months. The shares roared on Monday despite a double-downgrade from Telsey Advisory Group. Whereas, other financial analyst had a downward estimate for GameStop stock. Wall Street put the stock from outperform to underperform, adding that GameStop doesn’t support the fundamentals and valuation.
The sudden, sharp push in GME share price and valuation has been pumped by a short squeeze. Putting aside the involvement of activist RC Ventures and investors’ bullish intent for the new gaming cycle.
Moreover, the parabolic jump has reflected the conflict between day traders and bears betting on GME shares pushing back to reality. All this sentiment has aired the share price to a phenomenal point.
Not getting to the point that GameStop Corp. (GME) has potential in the long-term and Ryan Cohen joining in as the board member will make things better. The recent bullish run is poised to retreat as the current share price and valuation levels are not sustainable.
Though GameStop is a good stock as the company has done well financially and operationally in sequential quarters in recent times. But we believe that the uncertain share price will return to a more normal valuation effected by the fundamentals.