GameStop Corp. soared in January as short sellers were squeezed by a legion of buyers from Reddit’s Wallstreetbets. The shorts had to buy in order to close out their positions and stanch the bleeding, driving the stock even higher.
It seems they’ve learned their lesson. Short selling of GameStop shares has decreased dramatically, and the stock is no longer particularly heavily shorted:
Short interest in GameStop shares, a figure that represents bets against the stock on Wall Street, fell below 10 million at the end of last week, or just over 18% of the outstanding float. That’s down from around 57.8 million shares, or 113.3% of the float, when short-selling against the group peaked and Reddit-fueled buyers took the stock to a record high of $483 per share.
Many other stocks in the market are much more heavily shorted, such as Senseonics at 69% or GSX at 48%.
Where does that leave us? With stock in a money-losing company locked into long term leases on stores that were losing a fortune even before COVID. Without the possibility of another short squeeze, there is no catalyst for this stock to move much higher.
For more on GameStop, check out these posts:
- GameStop Options Expiration Could Crater Reddit’s Favorite Stock
- Pattern in GameStop Bonds Spells Trouble For Reddit’s Favorite Stock
- GameStop May Go Broke Before It Can Reinvent Itself
- There Could Be Another GameStop Short Squeeze, But Beware Weak Fundamentals
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Photo: “GameStop” by JeepersMedia is licensed under CC BY 2.0