London Daily

Focus on the big picture.
Saturday, May 30, 2026

GameStop nearly died in 2019. Now hedge funds are scrambling to deal with the company's exploding stock. Here's what's going on.

GameStop nearly died in 2019. Now hedge funds are scrambling to deal with the company's exploding stock. Here's what's going on.

The largest video-game retailer, GameStop, has gone from barely hanging on to wildly valuable — and it's all because of a Reddit forum.

Inside a GameStop store in Manhattan, New York, on November 12.

In early 2019, GameStop's stock value fell off a cliff: It dropped from about $16 per share to under $4.

And it stayed in that range for just shy of two years.

Even in 2020, while the video-game business (including GameStop) had huge gains during coronavirus lockdowns, GameStop's stock price remained in the gutter. As recently as August — just under five months ago — the largest video-game retail chain had a stock value of less than $5 per share.

But in the second half of 2020, with big financial names like Michael Burry and Ryan Cohen buying up shares in the ailing retailer, things started looking up. The company's share value gradually increased until it outright surpassed its pre-collapse value in late 2020.

And that's when it got really weird: Between January 20 and January 26, GameStop's stock value leaped from just over $35 per share to north of $140 per share. By January 27, it hit new highs of over $325 per share — an over 8,000% increase from just a few months ago.



But why?

The answer has little to do with GameStop, nothing to do with video games, and a lot to do with a Reddit forum dedicated to playing the stock market.

The forum, named Wall Street Bets, has over 2 million members, and it's the collective action of those members that appears to be driving up the value of GameStop's stock. Simply put: As more people buy the stock, its price increases. And there's no signs of that collective action stopping anytime soon.

"GME has bounced and is once again at $225," one thread in the Reddit forum said on Wednesday morning. "Hold strong boys ... we will take GME to $1,000."

Another thread urged users not to sell and to remove their $1,000 price limit, which would automatically trigger sales.

"GME will stay going until WE sell. Do not f---ing sell boys, $1,000 was the original target but nothing is stopping this from getting to $5,000 but us," it said. "It sounds like a meme but it isn't. Hold on tight and make father Musk proud!"

More than anything else, the prevailing theme in Wall Street Bets is collective power — enough collective power to push back on the hedge funds and analysts that predicted GameStop's stock would never reach such heights.

"FOR ALL THE BIG F---ING HEDGE FUNDS MONITORING US, THIS IS A MESSAGE FROM US TO YOU, WE F---ING OWN YOU NOW, F---. YOU. GO BUY THE F---ING NEWS. LIKE AND COMMENT SO THEY SEE THIS POST. F--- YOU MELVIN CAPITAL. F--- YOU CITRON RESEARCH. YOU HAVEN'T CLOSED S---. THIS IS GONNA GO DOWN IN HISTORY," one such post said.

But that doesn't mean the value will hold in the long run or that GameStop is worth its stock value to its shareholders.

The explosion in GameStop's stock value is "just a cult phenomenon," Michael Pachter, Wedbush Securities' managing director, told Insider. "They don't currently have the earnings power to support a price this high," he added.

That's because, like Blockbuster and Tower Records before it, GameStop faces major challenges to its business model from the internet. As more people buy video games through digital storefronts, fewer buy games on physical discs. And GameStop is in the business of selling physical discs.

Despite a shake-up to the company's C-suite and the addition of Cohen to the company's board, GameStop hasn't revealed a long-term plan to stave off oblivion.

"The market appears to believe Ryan Cohen has a strategy that will take earnings up by a lot," Pachter said. "I can't give him credit for his genius until I see what the strategy is."

Newsletter

Related Articles

0:00
0:00
Close
Japanese Technology Firm Fujitsu Launches Advanced Artificial Intelligence Tool for Corporate Disclosures
South Africa Officially Launches Nationwide Campaign for Highly Contested Local Government Elections
United Kingdom Commits Additional Funding for Unexploded Ordnance Clearance in Laos
Singapore Announces Stringent New Greenhouse Gas Regulations for Commercial Cooling Systems
Cambodia and Thailand Hold High-Level Border Security Talks at United Nations Headquarters
Myanmar Military Government and China Sign Major Agreement to Upgrade Media and Cultural Cooperation
Knife Attack at Swiss Train Station Leaves Three Injured in Suspected Act of Domestic Terrorism
Transnational Extortion Gang Threatens Canadian Police With Army of One Thousand Armed Operatives
Australia Imposes Forty-Two-Day Quarantine on Cruise Ship Passengers Following Deadly Hantavirus Outbreak
International Monetary Fund Unlocks Seven Hundred Million United States Dollars for Sri Lanka Following Economic Reforms
Australia Launches Record One Point Four Billion Dollar Lawsuit Against Chemical Giant 3M Over Contamination
China and Canada Foreign Ministers Meet in Ottawa in Effort to Stabilize Strained Diplomatic Ties
Indonesia Demands Urgent United Nations Security Council Reform Amid Escalating Global Conflicts
Extreme Weather Patterns Trigger Severe Drought in Madagascar and Destructive Flooding in East Africa
Indian State of Karnataka Faces Political Upheaval as Chief Minister Siddaramaiah Abruptly Resigns
Philippines and Japan Reaffirm Defense Ties as Crucial for Indo-Pacific Regional Stability
Norway Joins French Nuclear Deterrence Initiative in Major Shift for European Security Architecture
Global Critical Mineral Alliances Expand as Western Nations Move to Counter Chinese Supply Dominance
United States Imposes Fifty Percent Tariffs on Mexican Steel and Aluminum Ahead of Trade Pact Review
European Union and China Head Toward Major Trade Conflict Over Clean Technology Exports
United States Economic Growth Severely Downgraded to One Point Six Percent as Stagflation Fears Mount
World Health Organization Warns Central African Ebola Epidemic is Outpacing Containment Efforts
United States Treasury Department Conditions Sanctions Relief on Reopening of the Strait of Hormuz
Iranian Air Defenses Intercept and Destroy United States Military Drone Over Bushehr Province
Iranian Armed Forces Launch Ballistic Missiles Toward Unspecified Targets Prompting Regional Condemnation
United Nations Secretary-General Warns Global Order Facing Highest Level of Conflict Since 1945
Israel Issues Sweeping Evacuation Orders in Southern Lebanon Amid Intensified Hezbollah Conflict
Russia Announces Systemic Military Strikes Targeting Ukrainian Defense and Energy Infrastructure
United States and Iranian Negotiators Reach Draft Agreement to Extend Ceasefire and Resume Nuclear Talks
United Nations Security Council Deeply Divided Over United States Capture of Venezuelan President
US and Iran Exchange Direct Military Strikes Amid Fragile Gulf Ceasefire
World Health Organization Warns of Catastrophic Ebola Outbreak in DR Congo
Russia Threatens New Wave of Strikes on Ukrainian Infrastructure and Embassies
Scientists Warn Atlantic Ocean Currents Could Collapse Faster Than Projected
Anthropic Reaches $900 Billion Valuation in Historic AI Funding Round
Washington Imposes Crippling Sanctions on Iranian Maritime Authority
Japan and the Philippines Initiate Strategic Intelligence-Sharing Pact
Microsoft Deploys Autonomous Computer-Using AI Agents to Global Markets
Anthropic Secures $45 Billion Compute Infrastructure Agreement With SpaceX
U.S. Director of National Intelligence Resigns Amid Administration Shakeup
Micron Technology Crosses Trillion-Dollar Valuation Amid Unprecedented Hardware Demand
Canada and Germany Finalize Historic Long-Term LNG Export Agreement
China Expands International Travel Restrictions on Domestic AI Researchers
Japan Approves Sweeping Overhaul of National Intelligence Apparatus
Global Airlines Scramble Logistics as Middle East Airspace Remains Fractured
Japan's Naphtha Imports Plunge 47 Percent Amid Strait of Hormuz Closure
Global Crude Prices Retreat Below $96 as Gulf Tensions Momentarily Ease
Generative AI Outperforms Human Baselines in Landmark Global Creativity Study
NASA Partners With Private Aerospace to Unveil Permanent Lunar Base Architecture
South Korean Equity Markets Surge on Next-Generation Memory Chip Frenzy
×