Market News: What is happening with GameStop stock in 2023?
GameStop stock is one of the few companies who actually crushed in during the bear market in 2022.
The stock, currently trading at $18.40, amassed worldwide attention in 2021 when the ‘meme stock’ frenzy took Wall Street by surprise.
Today, GameStop has one of the most raving fanatics and shareholder base which without a doubt are the backbone of the company.
How much of GME’s float is owned by retail investors?
Approximately 70% of the float is owned by individual shareholders according to Vickers Stock Research.
GameStop’s Chair Ryan Cohen himself owns more than 12% of GME shares.
These are held through Ryan’s holding company RC Ventures, which Vickers considers to be Institutional ownership.
So, where is GameStop headed in 2023?
Let’s break down some important figures to determine just that.
Where is GameStop Headed in 2023?
2022 was another memorable year for GameStop.
Under Chairman Ryan Cohen and CEO Matt Furlong, it was the first year of the implementation of the company’s turnaround plan, which aimed to transform GameStop into a tech-oriented business.
This consisted of investment initiatives in e-commerce, an NFT marketplace, and Web 3.0 gaming.
But the company needs to focus on raising more capital despite its $1bn cash pile and having virtually no debt.
GameStop’s quarterly cash burn averaged at $400 million per quarter throughout 2022.
This means that if the company’s operating cash flow remains at similar levels next year, GameStop’s balance sheet could run out of cash in the next two years.
Over the last four quarters, GameStop’s sales have grown only by 1.3%.
Still, what made 2022 so significant for GameStop is the reporting of positive cash flow for the first time since Q1 of 2021.
Cashflow came in at $177.3 million this year compared to an outflow of $293.7 million last year.
This is already great news for GameStop going into 2023.
GME Stock Remains Popular Amongst Retail Investors
In 2023, GME stock will remain popular amongst retail investors, primarily due to the massive community of shareholders who are looking to take GameStop shares to the moon.
During the spark of the ‘meme stock’ frenzy, GameStop shares rose to $483 per share, a superior all-time high.
But shareholders are not convinced the stock is done running.
In fact, many GME shareholders believe share prices may skyrocket to new records, primarily due to overleveraged shorting in GameStop.
According to GameStop, shareholders registered 71.8 million shares via the transfer agent.
This equates to a massive 30% of GameStop’s total float – something that’s very unlikely in the markets.
Transfer agents can’t lend shares for short sellers who want to bet against GameStop.
The high number of market participants taking this action signifies that retail investors are here to stay.
Final thoughts
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2023 opens up new possibilities for GameStop as e-commerce, NFTs, and Web 3.0 gaming continues to grow.
While the company may benefit from arming itself with more short-term capital, GameStop enters the new year with positive cash flow, an incredible start for the company as many continue to struggle.
Even at a fundamental level, analysts are predicting GameStop stock to rise significantly higher next year.
But I’m curious to know your thoughts on where GameStop stock is going in 2023.
Leave your thoughts down below.
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Stock Market News: Carl Icahn is short on GameStop shares.
Billionaire investor Carl Icahn began shorting GameStop during the height of the ‘meme stock’ frenzy around January of 2021.
Carl Icahn still holds a large short position in GME stock, according to people familiar with the matter.
Icahn started building the short position when GameStop was trading near its peak of $483 per share and still holds a large bet against the retailer’s shares, said people, asking not to be named due to the matter being private.
The billionaire investor who has added to his position from time to time is betting that GameStop’s stock isn’t trading on its fundamentals and will continue to fall, insiders said.
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Ryan Cohen Posts Picture with Carl Icahn
GameStop chairman Ryan Cohen posted a picture with Carl Icahn in October which many shareholders anticipated as bullish future news.
People began to speculate Carl Icahn was going to buy GameStop shares.
Little did shareholders know that the multi-billionaire investor has been betting against GameStop since the beginning of the ‘meme stock’ frenzy, per Bloomberg.
At the time of the photo, neither individual confirmed that Icahn would take a stake in the retailer.
Market News: Bed Bath & Beyond’s CFO Gustavo Arnal has died after insider trading claims.
Bed Bath & Beyond’s CFO Gustavo Arnal died shortly after facing lawsuit claims of insider trading with GameStop’s Ryan Cohen.
His death occurred days after the company had announced it would be closing 150 stores and cutting 20% of its corporate staff.
The incident occurred less than two weeks after the executive, 52, was named in a federal class-action lawsuit on allegations of federal securities fraud, insider trading, and breach of fiduciary duty, according to court documents, per Business Insider.
The Chief Financial Officer was found dead on Friday after falling from the 18th floor of a New York City apartment building.
Arnal was cited in the suit along with activist investor and GameStop chairman Ryan Cohen, who the lawsuit claims collaborated with the CFO in a “fraudulent scheme to artificially inflate the price of Bed Bath & Beyond’s publicly traded stock.”
The lawsuit claims Cohen — who is also the co-founder of Chewy and chairman of GameStop — approached the CFO about his “pump and dump” scheme in March 2022, and “convinced Gustavo that their plan would be a mutually beneficial one.”
BBBY CFO & GameStop Chairman allegedly collude in pump and dump scheme
Ryan Cohen BBBY insider trading lawsuit claims.
“Under this arrangement, defendants would profit handsomely from the rise in price and could coordinate their selling of shares to optimize their returns,” the lawsuit states.
Arnal allegedly worked with JPMorgan, which is listed as a defendant in the suit on claims the bank “aided and abetted” the plan by “enabling Cohen to use JPM’s accounts to effectuate such transactions and otherwise launder the proceeds of their criminal conduct.”
Ryan Cohen made a profit of $68.1 million from his stake in Bed Bath & Beyond.
Bed Bath & Beyond was one of the so called ‘meme stocks’ that was halted last year alongside AMC Entertainment stock and GameStop after retail investors had aimed to squeeze short sellers from their positions.
Investors and shareholders are still figuring out how to process this tragic death.
Leave your thoughts down below.
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So, will GameStop see a massive short squeeze again?
Here’s what we know.
Welcome to Franknez.com – the blog where you can digest content on stocks, crypto, entrepreneurship, and trending investing topics.
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And if you’re not investing in the stock market and would like to learn how to buy GameStop stock or know where to buy GameStop stock, read my beginners guide on how to start here.
GME stock
GameStop closed at $40.53 on Wednesday, August 17th.
Trading volume is currently sitting at 9.3 million with 12.6 million now being GameStop’s average volume.
Understanding the short-seller
GameStop has taken the entire internet and finance world by a storm. What is happening nowadays.
Retail investors over at r/wallstreetbets have opened Pandora’s Box on short-sellers and hedge fund institutions.
Short-sellers are investors who short the stock.
Shorting a stock is the process by which sellers essentially bet on the stock price to drop.
They borrow stocks at a higher cost and sell the stock low, profiting the difference.
How short selling works
We’ve seen GameStop drop down and consolidate at $40 after its gamma squeeze peaked close to $500 per share back in January.
The stock has made a massive climb after some serious consolidation. It looks like GameStop is prepping itself for another gamma squeeze.
Could we finally see that GME squeeze everyone’s been waiting for?! I think its time.
See, GameStop’s short interest is still rather high and not all short sellers closed their positions back in January.
This means the stock still has loads of room to go bonkers.
What is a short-ladder attack?
A short-ladder attack is a strategy performed by short-sellers where they bid on the stock at a significantly lower sell price and purchase it from one another.
Thus, driving the share price lower.
How do you spot a short-ladder attack?
When the stock knows nothing but gains, but something keeps pushing it down until over and over again, that’s when you’ll know.
Why GameStop has potential for a second short squeeze
Short-sellers didn’t learn their lesson from the first time. GameStop stock is still being heavily shorted.
With GameStop becoming a technology company, its value has not only significantly gone up but it now has even more potential to keep driving its momentum.
Retail investors have a strong conviction towards GameStop investment. This means they’re not willing to sell the stock which in turn creates a supply and demand scenario with short-sellers who have to close their positions.
GameStop NFT Marketplace News
Short Share Availability and Short Borrow Fee Rate
You can see GameStop’s short share availability and short borrow fee rate using this link (via. Short interest data)
This number of course changes every day and can be expected to rise as hedge funds continue to short GameStop stock.
However, the short borrow fee rate isn’t a catalyst for GME to squeeze.
I’m excited for my subcommunity that holds both GME and AMC stock because both are about to skyrocket past Pluto.
GME Stock Analysis
Roensch Capital goes over the data for trending stocks.
The information is very easy to understand and gives you insight in the market from an analysts perspective.
Be sure to check out recent videos as they’re being uploaded to stay updated with any changes that occur in the market with GameStop.
Important Advisory
It is important to note that I am not a licensed financial advisor.
Like many traders and self taught investors, all speculation is based on educated estimations based on highly reliable analysis, patterns, and documented news charts.
Volume is key to a second GameStop short squeeze
Just like AMC, GameStop will need to see a continuous runup in share volume.
When retail investors continue to buy and hold GameStop stock, short-sellers shorting the stock eventually have to buy back the stock.
This demand and supply scenario results in various gamma squeezes.
The gains we’ve seen with GameStop have been a series of gamma squeezes, or incremental gains.
Usually what follows after gamma squeezes is a short squeeze if it has enough volume.
The volume of shares depends on how much retail investors are purchasing GameStop stock or selling it.
This chart is only reference and is not GameStop’s current price – GameStop Squeezable
How Soon Will A Second GameStop Short Squeeze Happen?
There is so much volatility occurring in the stock market at the moment.
Such volatility is usually a sign of an upcoming short squeeze as we saw back in January.
Not only are retail investors experiencing a lot of volatility, but GameStop stock seems to be in bullish territory which is great for volume.
FOMO (fear of missing out) continues to bring in new retail investors which is a great driving factor to the stocks volume.
GameStop announces fourth quarter earnings for 2020 (ARCHIVE)
is GameStop squeezable? – GameStop Short Squeeze
Saving GameStop
Retail investors now have the power to save any company they wish to save.
Now it’s only a matter of time for GameStop to step up and raise capital so that they can innovate and provide more value back.
GameStop is currently looking for ways to operate more efficiently.
While the Reddit community was able to keep them from going bankrupt, the company as a whole will need to continue kicking butt.
Here’s what’s been going on with GameStop recently.
Current GameStop news
is GameStop still squeezable? – GameStop Short Squeeze
GameStop introduces Matt Furlong as the new CEO of the company.
GME shares are still up nearly 1100% this year-to-date with the company’s valuation at $15 billion.
Bullish GameStop options are still currently being heavily traded
Prior to GameStop, Matt Furlong worked at Amazon in Australia overseeing the growth of operations.
He also worked in brand and marketing for Procter & Gamble years before.
The skills to grow operations and to properly brand and market will benefit GameStop immensely.
What can retail investors do to tackle shorting?
If retail investors want to counter GameStop’s stock price from plummeting, they’ll have to continue to hold and buy the stock.
This short squeeze play will require patience.
Important advisory
If you hold a position in GameStop, it’s important that you ask yourself what your reason for holding is.
Does your DD provide you with the confidence to stick to it longer if need be?
If so, stick to your convictions and trust the process.
Unfortunately, I didn’t get in on GameStop before it gamma squeezed so I took a position in AMC instead.
Taking this position has been one of the best financial decisions I’ve ever made.
I would take a position in GameStop if it was more affordable.
Regardless, I like the stock and I love the community even more.
Will GameStop finally short squeeze?
I think GameStop is preparing itself to put short sellers out of their misery.
The stock has been havoc to hedge funds and we can tell they’re giving out primarily due to this massive breakthrough we’re seeing now.
And although I personally don’t hold GME stock, I have a lot of awesome memories at GameStop which I would actually like to share with you at the end of this article.
Now let’s talk about a little justice.
A major hedge fund that was attacking GameStop has now been reported to lose a significant amount of money.
A gamma squeeze are momentum gains. These usually occur from call options closing in the pocket resulting in heavy buys or purchases in the market.
A short squeeze is vigorous and can spike with no warning. This is where you see 100% gains in a matter of seconds and minutes. A short squeeze can even reach 1000% and 10,000% gains.
