GameStop Corp. (NYSE:GME) stock jumped by about 10% in early trading after the company announced that CEO George Sherman would step down by July 31. Meanwhile, a key Reddit influencer doubled down on his bet on Friday instead of taking a quick profit on the brick-and-mortar video game retailer.
GameStop soars after CEO announcement
GameStop has been at the center of controversy at various times this year as users of the Reddit forum WallStreetBets targeted heavily shorted stocks. The shares had come down a bit from where they were when they spiked in January, February and March, but they are still higher than they were before the January spike.
GameStop announced this morning that Sherman would step down on July 31 or before if a successor is found. In a statement, the retailer said its board is heading up the search to look for candidates with the experience and capabilities to speed up the next phase of its digital transformation.
GameStop stock hit a record high of $463 in January, and although it has come down since then, it remains up 720% year to date. The video game retailer announced it would sell $1 billion in stock to take advantage of that huge rally and speed up its e-commerce transition. Board member and activist investor Ryan Cohen is spearheading the transition. Cohen also co-founded Chewy.
Keith Gill doubles down on GameStop
According to CNBC, Keith Gill, known as DeepF____Value on Reddit and Roaring Kitty on YouTube, doubled down on his GameStop bet on Friday, giving up a quick profit amounting to millions of dollars on an options trade. Gill may be the most significant trading influencer on Reddit.
He exercised his 500 GameStop call options on Friday when they expired, which gave him another 50,000 more shares at a strike price of $12. If Gill had sold the options at the market price on Friday, he would have raked in over $7 million.
In addition to exercising those options contracts, he bought another 50,000 GameStop shares, bringing his total investment to 200,000 shares of the game retailer worth over $30 million. CNBC gleaned the information on Gill’s trades from his Reddit posts, which appear to be snapshots from his investment account. The news outlet did not independently verify the information from the posts.