In recent days, GameStop (GME) and AMC Entertainment Holdings Inc. (AMC) have seen a surge in share prices driven by online groups aiming to squeeze short sellers. Retail traders have been flocking to these companies, with GameStop receiving over $15.8 million in net inflows and AMC seeing $37.5 million on Monday alone, according to data from Vanda Research. However, these figures are significantly lower than the peak daily inflows of $87.5 million for GameStop and $170 million for AMC observed in late January 2021.
The recent gains of over 70% for both GameStop and AMC were fueled by cryptic posts from "Roaring Kitty," also known as Keith Gill, who played a key role in the meme stock craze of three years ago. While these posts initially sparked optimism for a resurgence of the meme stock trend, the rallies on Tuesday were more subdued. Despite this, GameStop and AMC were still up by more than 55% and 40% respectively as of 2:15 p.m. ET, with both stocks having soared over 150% week to date.
However, some investing professionals have expressed concerns that these stock movements lack significant catalysts. The renewed interest in these equities has already led to trouble for investors shorting them, with reports indicating losses of over $1 billion for GameStop short sellers from Monday's rally.
Overall, the recent activity surrounding GameStop, AMC, and other meme stocks has generated both excitement and skepticism in the market. While some view these movements as a potential opportunity for profit, others question the sustainability of these rallies without solid fundamental reasons. As the situation continues to evolve, investors and analysts are closely monitoring the developments to gauge the long-term implications of these stock movements.