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GameStop (GME) Stock Up Nearly 10% After Selling 3.5 Million Additional Shares

UTC by Ibukun Ogundare · 3 min read
GameStop (GME) Stock Up Nearly 10% After Selling 3.5 Million Additional Shares
Photo: Depositphotos

GameStop stock has grown about 2,800% in the last twelve months, and 796.66% since 2021 began.

Shares of electronics retail company GameStop Corp (NYSE: GME) surged after the company generated $551 million from stock sales. The company’s shares jumped in after-hours trading after securing the funds from the sales of 3.5 million additional shares.

GameStop Sees Increases in Shares

The jump in GameStop shares can be attributed to the Reddit retail trading crowd. Before the nearly 10% gain in extended trading, GameStop stock had advanced almost 12% during the day.

GameStop stock has grown about 2,800% in the last twelve months, and 796.66% since 2021 began. In the last three months, the video game retailer has spiked nearly 120% and advanced further by 2.77% in the last five days. However, GME shares have declined 6.82% over the past month. GameStop has a market valuation of $10.59 billion. GME, which traded at less than $20 per share at the beginning of the year, is currently at an after-hours trading price of $185.

In late January, a group of retail traders on Reddit fueled increases in certain stocks. At a point, GameStop surged as much as 400%. During the same period, some trading platforms like Robinhood temporarily banned trading the affected stocks on their platforms.

GameStop to Shift towards e-Commerce

GameStop is at a point of a shift to e-commerce. Activist investor and board member Ryan Cohen is the executive spearheading GameStop’s push into e-commerce. Citing familiar sources with the matter, Bloomberg said that Cohen, who was also Chewy’s co-founder, plans to use the model he pulled on Chewy to actualize his aim.

According to the Bloomberg report, Cohen plans to address the substandard customer service GameStop offers to its customers. Cohen hopes to upgrade the company’s customer care sector and leave customers with a five-star experience. Additionally, Cohen is also considering opening centers to train aspiring gamers.

To facilitate his goal, Cohen, after becoming GameStop’s chairman in June, brought in Kelli Durkin, who spearheaded the customer service program at Chewy. Durkin is now the senior vice president of customer service at GameStop.

An analyst at DFC Intelligence, David Cole, believes Cohen is in the best position to push GameStop forward. Cole commented:

“Making a pivot into online retailing is very difficult. However, someone like Cohen – with an aggressive push – is what is needed to have any chance of success.”

In a filing with the US Securities and Exchange Commission (SEC) on the 18th of April, GameStop announced that George Sherman would be stepping down from his CEO position. As stated in the filing, GameStop has entered into a “Transition and Separation agreement” with Sherman.

The CEO will exit his role by the 31st of July or before the said time if a successor is appointed. Following the news of the CEO exit, GME soared more than 8% in early trading on the 19th of April.

Business News, Market News, News, Stocks, Wall Street
Ibukun Ogundare

Ibukun is a crypto/finance writer interested in passing relevant information, using non-complex words to reach all kinds of audience. Apart from writing, she likes to see movies, cook, and explore restaurants in the city of Lagos, where she resides.

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