A GameStop store opens in a Chicago strip mall on March 16, 2023.
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game stop and AMC Stocks fell on Wednesday as the meme stock trading frenzy showed signs of slowing.
Brick-and-mortar video game retailers were down 29%, and movie theater chains were down 22%. Before Wednesday, GameStop and AMC were up 179% and 135%, respectively, this week.
AMC Entertainment
The decline in AMC stock came after the company announced a debt-for-equity swap. AMC will issue 23.3 million shares in a debt-for-equity exchange in exchange for $163.9 million in bonds that mature in 2026. The company also completed a $250 million stock sale on Monday.
Both meme stars experienced surprising share price gains and explosions in trading volume earlier in the week, but this time the retail interest is much smaller and doesn’t appear to be long-lasting. In terms of net retail trader inflows, it pales in comparison to the frenzy of three years ago.
For example, net inflows from retail traders to GameStop and AMC on Monday exceeded $15.8 million and $37.5 million, respectively, according to Vanda Research data. However, this amount dwarfs GameStop’s daily peak of approximately $87.5 million and AMC’s $170 million seen in late January 2021.
game stop
Unusual social media reignited speculation on Monday. update From “Rolling Kitty”. The man, whose legal name is Keith Gill, posted a photo on social media platform X of a video gamer sitting facing forward in a chair. This is a meme used by gamers to show that they are serious about gaming.
Gill, also known as DeepF——Value on Reddit. A former marketing executive at Mutual Life Insurance of Massachusetts, he led a large number of day traders to flock to GameStop in 2021.
The resurgence of the meme stock phenomenon sent shares of GameStop and AMC up more than 70% on Monday, and the stocks continued to rise through Tuesday. Enthusiasm seemed to have waned by the end of the previous session.
Cole Smead, CEO of Smead Capital Management, calls the meme stock boom ‘frankly stupid’ and a ‘gamble’ on CNBC’s ‘Street Signs Europe’ said.
— CNBC’s Alex Harring contributed reporting.
