In November, he started what might be called an activist investor’s campaign, in which an investor buys a not-insignificant stake in a company, then makes a nuisance of themselves, publicly questioning management’s aptitude and agitating for control of the board of directors.
(NYSE: CHWY) and generic venture capital type guy Ryan Cohen started accumulating shares until he owned 12.9% of Gamestop. This past August, as Gamestop the stock failed to keep up with a broader equities market that was heating up, former CEO of pet food e-retailer Chewy Inc. Notably, though, the people who complained about GameStop trade ins tended to complain about them a lot, indicating they went back. Even before the pandemic made shopping malls a bio-hazard, consumers were done with Gamestop, which was best remembered for giving a trade-in value of around 3% on old games towards the purchase of new games. That made some very obvious sense, because Gamestop is a physical retailer of a product generally sold over the internet. Prior to about two weeks ago, Gamestop the stock had more or less been a reflection of Gamestop the business, which had been sucking wind for quite some time. It’s best to start at the beginning, which isn’t complicated at all. It’s one of those confluence-of-events types of scenarios where everything’s set up just so, and the setup is so widely followed that it takes on a life of its own. There’s no simple reason that Gamestop (NYSE: GME) became the subject of the most high-profile short squeeze anyone can remember.
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