Yahoo FinanceFlash in the Pan Meme Moment Takes Some Stock Traders on Wild Ride

(Bloomberg) -- The meme-stock revival was over almost as quickly as it began.
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GameStop Corp. and AMC Entertainment Holdings Inc. — the poster children of 2021’s frenzy — saw shares surge at the start of the week only to fizzle, with the bulk of those gains erased just days later. Other speculative corners of the market, mainly beaten-down stocks that have drawn the scrutiny of short-selling hedge funds, saw their booms mostly go bust while the broader US stock market powered to record highs.
Read MLIV Pulse: Meme-Stocks Pop Signals Too Much Froth in Stocks
An X post from Keith Gill — one of the masterminds behind the Covid-era spike in GameStop, better known as “Roaring Kitty”— set social media platforms abuzz into Monday morning as traders, both amateur and professional, pounced on old day-trading standbys and other stocks that seemed susceptible to a short squeeze. However, unlike the 2021 delirium that lasted weeks and resulted in congressional hearings and lawsuits, the revival of meme stocks was a flash in the pan.
With the rally quickly losing its shine, AMC shares have slipped more than 60% from an $11.88 intraday year-to-date high while GameStop gave back almost all of its gains. The differences between the two frenzies — if you can call the latest iteration that — were quickly apparent. In 2021, GameStop soared more than 1,000% in a matter of days, making this week’s peak look tame as the pair only held onto mere double-digit gains for the week.
Still, a more than 100% rally over four weeks is nothing to completely shrug off for the video-game retailer. The stock has put together four consecutive weeks of gains, adding some $3.6 billion over that stretch, though it’s still more than 80% below a 2021 high.
Both companies moved to capitalize on the rallies to shore up their cash reserves this week. GameStop arranged to sell up to 45 million shares in a so-called at-the-market program, enabling its bank to create shares for sale, with the proceeds being added to its balance sheet.
For AMC, the beleaguered movie chain was able to raise more than $250 million through share sales and a debt-for-equity swap though it still faces more than $4 billion in debt, according to Bloomberg Intelligence. This week’s gains look like a blip given it’s still down some 90% over the past 12 months.