GameStop shares soar after Reddit favourite raises $ 551 million

GameStop’s share price rose Tuesday after the video game retailer sold 3.5 million additional shares and raised $ 551 million to accelerate the company’s e-commerce transformation.

The stock favored by the Reddit retail industry rose more than 5% on Tuesday after gaining nearly 12% during Monday’s regular trading hours. Shares are up nearly 850% this year.

GameStop announced the “at-the-market” share offering in early April, which was seen as a way to capitalize on its recent high-profile rally that made Wall Street history.

In late January, a group of Reddit-owned retailers coordinated trading in sharply shortened stocks and sparked a massive short squeeze on GameStop, whose stocks were up 400% at one point. The brick and mortar retailer was trading at less than $ 20 per share in early 2021.

The company is currently in the midst of a shift to e-commerce, led by activist investor and board member Ryan Cohen, who was Chewy’s co-founder.

Last week, GameStop announced that its CEO George Sherman will be stepping down until July 31st. The board is conducting a search for CEO candidates who can accelerate the next phase of the company’s transformation.

The company also hired former Amazon and Google CEO Jenna Owens as its new chief operating officer.

Did you like this article?
For exclusive stock selection, investment ideas and CNBC Global Livestream
Sign up for CNBC Pro
Start your free trial now

Leave a Reply

Your email address will not be published. Required fields are marked *