Key Takeaways
- “Roaring Kitty,” the figurehead of the meme stock craze, returned to posting on X on Friday, sending shares of GameStop and other meme stocks higher.
- The characteristically cryptic post from Roaring Kitty may have led some to speculate he was going back to investing in GameStop.
- The video game retailer reports earnings on Tuesday. Analysts see its revenue falling and loss widening.
“Roaring Kitty” is back, and meme stock investors are once again the beneficiaries.
Shares of video game retailer GameStop (GME) jumped after meme stock hero Roaring Kitty, whose real name is Keith Gill, posted on X for the first time since June. The shares later pared some of their gains, though they remained up about 6% late Friday afternoon.
Some may have read the post, an edited still from the movie “Toy Story 2,” as a message that Gill was dropping his investment in online pet retailer Chewy (CHWY), which he owned more than 6% of in early July, and switching back to GameStop. Chewy shares fell about 3% before recovering. Shares of AMC Entertainment Holdings (AMC), another meme favorite, were also rising late Friday.
GameStop Earnings on Deck
The buzz around GameStop comes just days before the company is set to release its second-quarter financial report. It’s expected to post a year-over-year drop in revenue and a wider net loss.
Wedbush analysts in a note Friday expressed skepticism about GameStop’s future. “The company continues to face a near insurmountable barrier to its planned return to growth,” they wrote, including the gaming industry’s shift toward digital sales and subscriptions, and the company’s “total lack of any strategy to enter new categories with growth potential.”
Wedbush reiterated its “underperform” rating of the stock, arguing that shares trade “at a level that ignores the company’s many challenges ahead.”
Nonetheless, shares of GameStop are up about 33% this year.
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