GameStop stock rose 23% in early Thursday trading to hit a high of $38.55 on the back of a $1.2 billion increase in market value, according to Bloomberg. The market value increase reflects a rise in retail-investor demand since activist investor and Chewy Inc. co-founder Ryan Cohen joined its board on Monday.
- Demand from day traders, combined with short covering, fueled GameStop stock’s bullish run.
- The stock’s surge marks GameStop’s best winning streak ever and comes in the face of skeptical analysts who had broadly advised investors to stay away.
- Many traders are betting the GameStop will undergo a renaissance or be sold after the arrival of Cohen and two former Chewy colleagues to the board.
- Telsey Advisory Group is the only firm with a “buy” recommendation on GameStop shares, compared to four analysts advising a “hold” and three for a “sell.”
- Bets against GameStop have climbed over the past year, with 138% of shares available for trading currently sold short.
- Analysts point out that the need for investors to cover the positions is likely fueling a short squeeze and fanning the stock’s run.
- Wall Street has an average price target of $12.36 on GameStop stock, implying a downside of roughly 70% over the coming year.
GameStop stock is currently gaining. GME: NYSE is up 13.92%