![]() “My thesis is not contingent on a turnaround or business expansion, this is solely a deep value play,” wrote delaneydi. ![]() With GameStop’s shares and profits both falling for years, a thread by user “delaneydi” said detractors were undervaluing the retailer’s cash, with which the shares were deceptively cheap. Twenty-two months ago, inklings of a bull case started showing up on WallStreetBets, the Reddit forum that has become synonymous with retail zeal in the pandemic age. Ironically, in tracing the history of WallStreetBets’ fascination with the stock, that’s exactly what the chat-room faithful said they were doing when they set out on their journey. Last week, before his decision to go mute on GameStop, Left issued a plea to would-be buyers: “look at valuations,” which are by some measures stretched. “Any rational person knows this type of trading behavior is short lived.” “Price movement aside, I am most astounded by the thought process that goes in to making these decisions,” Left said in an email to Bloomberg News on Monday. Today, Left finds himself first among the hunted, his decision to stop publicly bashing GameStop helping drive it up as much as 78% on Friday. GameStop, which isn’t expected to turn a profit before 2023, has seen its market value triple to $4.5 billion in three weeks, burning the skeptics whose any attempt to cover is likely to further propel its ascent.Ī notable victim of the shift has been Citron Research’s Andrew Left, once Wall Street’s most celebrated iconoclast for his role hounding Bill Ackman out of another battleground stock, Valeant Pharmaceuticals, five years ago. Hedge funds had been winning so long that they overlooked the tinderbox they were creating should sentiment turn. Before this year, GameStop was a cash register for bearish traders, who borrowed and sold more shares than the company issued. In their frenzy, WSB’s cocky hordes have managed to turn the tables in a game short sellers invented, spinning gold from the complacency of others. For those wagering on a decline, it’s been a catastrophe. GameStop has become a money geyser for the options-obsessed crowd that gathers in Reddit’s WallStreetBets forum. It’s a role cast for them with relish by their chat-room usurpers, the tens of thousands of average Joe day-traders whose fervor for a left-for-dead retailer has become a self-fulfilling prophecy in its 245% rally this year. ![]() Now in the vortex engulfing GameStop Corp., they have a new name: the establishment. (Bloomberg) - Short sellers have been called a lot of things. ![]()
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |