That's why this Reddit saga isn't just about fundamentals. With malls dying across the world, those fundamentals aren't about to change - and certainly haven't changed so dramatically in the past few days and weeks to send its stock soaring nearly 700%. It was struggling before the pandemic, as video games went digital and Amazon began eating into its market share. Also, video games are a hot commodity in the stay-at-home era, particularly after the launches of the PlayStation 5 and Xbox Series X.īut GameStop faces many of the same problems that other retailers face. Similarly, GameStop may have been oversold and due for a comeback: Investors on social media had been arguing that GameStop was seriously undervalued and cheered earlier this month when the company added Chewy founder Ryan Cohen, who has been pushing a digital overhaul, to its board. titles simultaneously in theaters and on HBO Max. That's a bold bet - blockbusters like the new James Bond movie keep getting pushed back, and CNN parent company WarnerMedia pledged to release all of its Warner Bros. Last year, the company said it doubted its ability to stay in business.īut AMC's CEO told CNN Business Tuesday he is now hopeful (after an influx of cash) that the company can ride out the pandemic until people are ready go back to theaters. AMC wasn't exactly a top performer before the pandemic, and the massive drop-off in theater attendance over the past 10 months sent it scrambling for cash. "We made these decisions out of an abundance of caution amid unprecedented market conditions and other factors," the TD Ameritrade spokesperson added.ĪMC is struggling financially - just like GameStop - and is a favorite stock of short sellers. "In the interest of mitigating risk for our company and clients, we have put in place several restrictions on some transactions in GameStop, AMC and other securities," said a spokesperson for TD Amerirtrade, which is no owned by Charles Schwab. And the dramatic spikes caused at least one top online broker, TD Ameritrade, to curb trading in the two companies. Shares of the new WSB plaything were up more than 200% Wednesday after members of the Reddit board and investors on online brokerage firm Robinhood were touting the stock and got #SaveAMC trending on Twitter.īoth stocks had their trading occasionally halted for volatility Wednesday. Today's target: AMC, the (very) struggling theater chain that just announced a nearly $1 billion lifeline to stay open. Their best-known bet is GameStop, which is up another 135% Wednesday after nearly doubling Tuesday and soaring more than 1,730% this year. A group on Reddit's Wall Street Bets board have been promoting a number of stocks, hoping to squeeze short sellers that have been betting against them.
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