Feb. 12, 2022 1:47 AM ETGameStop Corp. (GME)126 Comments
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Summary
- A large portion of the market still expects a short squeeze, or a monster short squeeze, in shares of GameStop.
- The dollar amount of shorted GME shares has greatly declined over the last year, however. GameStop’s share price also went through a large drop in pricing.
- A short squeeze, one year after GME gained traction on WallStreetBets, is unlikely to happen.
- A growing focus on GameStop actual business performance indicates more downside potential.
A full year after shares of the original Reddit meme stock, GameStop (NYSE:GME), exploded higher, many WallStreetBets readers still expect a big short squeeze. In some cases, investors even suggest that we could see a “mother of all short squeezes”, or MOASS. However, the short interest trend indicates that the likelihood of a (big) short squeeze is very low. Since the focus has also slowly returned to GameStop’s actual commercial performance, headwinds for the stock are only going to grow!
Successive decline in short interest
More than a year ago, the GameStop saga began when traders on Reddit banded together to organize mass buying in certain stocks in a bid to initiate short squeezes in the market. Reddit traders were hugely successful in their attempt to force hedge funds to liquidate their short position in GameStop. Multiple hedge funds ended up closing shop after sustaining massive WallStreetBets-driven losses. One of the largest short sellers in the GameStop trade, Melvin Capital, was forced to close its position in GME in January 2021 due to GameStop’s soaring valuation. The trading frenzy in GameStop stock and the massive short squeeze that occurred in January 2021 dealt a 49% capital loss to the hedge fund in the first quarter of last year. London-based hedge fund White Square Capital went out of business altogether after making wrong-way bets on GameStop and AMC Entertainment, another popular short seller target last year.
GME and AMC Entertainment have both seen spectacular increases in their valuations in the first quarter of 2021 but both companies have seen material declines in pricing since.
The large drawdown in the valuation of GameStop coincided with a decline in the number of shares shorted as well as short interest ratio. The dollar volume shorted in GME stock at the end of January 2021 was $4.1B and has since decline significantly.
Today, about 24% of GameStop's float remains collectively shorted by different investors. Most of them are likely still hedge funds but it remains unclear at what point a short position was initiated. A hedge fund could have shorted GameStop in December at $180, with shares being included in the short interest ratio, and the trade would still be profitable today.
The massive decline in GameStop’s short interest ratio implies that most wrong-way bets from last year have already been dissolved. Those who got caught on the wrong foot in the GameStop trade last year have already liquidated their positions and moved somewhere else. Neither GameStop nor AMD Entertainment feature amongst the most heavily shorted stocks in the market… they are not even in the top twenty of most heavily shorted stocks anymore.
The price trend of GameStop’s shares also shows a fairly consistent and long term decline, indicating that interest in the meme stock is waning. This naturally implies that the likelihood of another 2021-like short squeeze, not to mention a “mother of all short squeezes”, has become highly unlikely.
Over the last year, the focus has also turned back to GameStop’s actual business performance, which doesn’t look all that good.
Dismal commercial performance
There is very little that stands in the way of GameStop going the way of Blockbuster, a video game rental service that was innovated out of existence by streaming company Netflix. While GameStop’s price initially soared in 2021, the firm’s actual operations continued to lose a lot of money last year. On $3.8B in revenues, the video game retailer lost $233.8M in the nine months that ended on October 30, 2021. Free cash flow in the first three quarters of fiscal 2021 was $(365.1)M, showing that the company’s business model is still not cash-positive.
While GameStop’s top line grew 27% compared to the year-earlier period, the bounce in revenues is likely due to the reopening of the economy and doesn’t indicate improving commercial performance. GameStop’s long term financial trends are highly worrisome, with revenues, cash flow and margins all trending down or being negative. One of the biggest concerns for me is the persistently high level of cash burn and the negative operating margins which already indicate that GameStop’s business may not survive.
Risks with GameStop
GameStop’s commercial operations are not doing well and the video game retail chain is likely to lose more money in 2022 as well, implying negative operating margins and elevated levels of cash burn. The biggest risk, however, relates to expectations of a big short squeeze, or MOASS, which is highly unlikely to happen given the successive dissolving of short interest positions over the last year.
Final thoughts
The likelihood of another short squeeze -- which is still passionately discussed on WallStreetBets -- is very much exaggerated since interest in meme stocks has waned, short positions in GME have already been liquidated and the business continued to denigrate in 2022. Additionally, short squeezes can only happen when a stock price rises, not when it falls and shares of GME are down 65% from their 1-year closing high. Finally, the business continues to deteriorate and investors are far more willing to pay attention to this overlooked little detail than a year ago.
This article was written by
I look for high-risk, high-reward situations. Five largest portfolio holdings: Bitcoin, SoFi, Alibaba, PayPal, Western Alliance. Early buyer of cryptocurrencies. I live in Thailand :)
Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
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Comments (126)
B
17 Nov. 2022
GameStop closed at $28.50 in AH which is equivalent to $114 presplit. Technicals are strong and there looks to be some upside in the near term. Moass baby.
g
07 Apr. 2022
Prepare to get rekt, stormtroopers! $280 next week. $350 before earnings. $400 by late June. INSANE SQUEEZE STARTS MID-JULY!
A
08 Apr. 2022
@gme4life Everyone is free to live in his own dreamworld.
This is a weak stock and is falling day after day, I wonder what makes you think it will touch $280 next week and $400 in July? more likely it will touch $100 this month and continue falling month after month.
g
09 Apr. 2022
@A.Jay My dreamworld is the shorts' nightmare. YOU HAVE BEEN WARNED! Cover first or be destroyed.
A
10 Apr. 2022
@gme4life We will know within the week, as to who will be destroyed.
By the way I am expecting another 20% fall from these levels of $146 this month itself.
28 Mar. 2022
Up 24% today.
25 Mar. 2022
How 'bout now???
Again, all of them strong sell/sell ratings...Nuffing. Nada.
Yaaaarrr.
T
18 Feb. 2022
Probably Nothing 🏴☠️
Ongoing DOJ investigation on Short Selling
18 Feb. 2022
@Tedzir
It probably must be that conspiracy cult full of filthy animals, looking for an ark 🤫
Ahoy, mates...i'm (perhaps early, but not wrong) already on board, are yeee?
18 Feb. 2022
Yarrrrrr...
To the plank with those holding back our beloved stonk of stonks. #GME
18 Feb. 2022
If it had to come from FINRA, it would have been like a blind man trying to hit a piñata, it looks like 😂
FINRA 2022 Report on Examination and Risk Monitoring
=>The Report also identifies some new areas of focus for 2022, specifically: (a) Firm short positions and fails-to-receive in municipal securities;
Yeah, really...municipal securities...only those?
FINRA is not part of the government. It is a not-for-profit entity and the largest self-regulatory organization (SRO) in the securities industry within the U.S.
That's like...me, if i was investigating myself...
j
18 Feb. 2022
I fully understand and support GME (10K shares DRS’ed). What I don’t understand is why the “Apes” want the price to go up before the DRS number is achieved. As long as the price stays.below $150 more “Apes” can buy and DRS. It is really eye opening to see single shares purchased from all areas in the world. The largest I’ve seen is 30+k.
To top that off thousands of these stock holders (many are brilliant) post continual DD and watch for all signs of criminal activity in the market. We should take a hint and do the same and get involved. Help the SEC find all the crime and prosecute the crooks. They will not get it done without bright lights shining on the crooks.
STOP NAKED SHORTING IN ALL FORMS.
18 Feb. 2022
@jbw1937
I can relate, but let's not forget that there are still apes out there, hanging on at much higher levels, refusing to sell until there is change.
It ain't that easy to keep the spirit up, if you see crime occurring on a daily basis, and you realize that they steal your hard earned money.
By the way, did you read about the naked shorting/Canada connection? I already heard something about it on Youtube, but this person did some extensive DD on the topic. 👍
? Might be something, might be not either 😉
j
19 Feb. 2022
@Gunne Good read, I would say for certain they would take advantage of a no rules arena. Same reason Clinton’s put their “charitable” trust in Canada. This is the real reason for DRS. The crooks have set all the rules and the only way to stop them is to totally control the stock.
Personally, I don’t expect them to roll over until Cohen reveals the total package. Way better then betting on beating government protected crooks. For the same reason the Apes that bought early got trapped. Buy all you can afford under 150-200 and average down if your caught on the high end. Relax and let the game come to you. They truly are f*ck—,
22 Feb. 2022
I don't know about that “charitable” trust in Canada from the Clinton's.
I do know a couple of reasons why it would be very sound strategically, if Uncle Sam did a couple of things...
And it comes down to one of the things most people do remember about B. Clinton.
Gamestop, imo, is part of the solution.
16 Feb. 2022
Rising interest rates and QT bad for cashflow negative businesses.
16 Feb. 2022
Bad for companies loaded with debt.
GME? Not going to have to worry about cash in the short term and long term jmo.
17 Feb. 2022
@Gunne But GME also not generating much cash. People would rather buy US treasury bonds than stocks like GME if interest rates are higher.
17 Feb. 2022
@jz10
"People" is generalizing.
Plenty of them people really like the #GME stonk, too.
Why not, these are nutty times, in the market.
Have you ever seen something like this?
I haven't.
Necessary though, if you ask me, and not as bearish as some want you to believe.
16 Feb. 2022
Ryan Cohen don't look now but Pro Sektor barely puts you ahead of that idiot buying and leasing more theater space instead of building outside drive ins and going thru a credit union this time.
When your home Adam Aron sells his eight billion debt in popcorn just fill his own Christmas can without regular flavor
Cheese, white cheddar, caramel
Flood Wal mart cvs, riteaid, Walgreens target with that.
We know why your taking your sweet time Ryan cojen
You already made your billions
You want to add some gme at forty
That moron Adam Aron buying more and leasing more theater cht. Lol
You buy and build outside drive ins because covid going nowhere. New variant every 120 days.
And then Cohen you have had way too long to do something about nfts the company and the hooders getting manipulated... Longs stuck in gme are not as stupid as the longs who keep buying and holding amc... Amc twelve coming with three times the newbies stuck in it gme has.
Pro Sektor since 1997
j
16 Feb. 2022
@Sektor Rotation were you having a toddy or two?
16 Feb. 2022
T
16 Feb. 2022
Thanks for reminding me to forget about GameStop. (Streisand effect)
16 Feb. 2022
@Tedzir
Agreed. Definitely a squeeze delusion, too.🙃
Theyyy closed/covered, yet, once again 👇
GME largest short value at Interactive Brokers, about double the size of a far distance second 😏 🥳
PS. Check the borrow fee at iborrowdesk of the other tickers, you'll get an idea how much naked ones of GME floating around.
Buy/HODL/DRS the stonk of stonks #GME
No financial advice.
16 Feb. 2022
Borrow fee coming down again, more naked ones as we speak.
Source : Interactive Brokers
All to no avail, GMERICA 🗽 👌 🤠 👊 🏴☠️ will prevail.
💎🙌🚀
16 Feb. 2022
Oh yeah, apes... Did we see AMC in the list of largest short values on the third, when the borrow fee was above 1% for AMC? Nope, but GME took top spot once again, they can tag the tickers all they want,
but...GME≠AMC
Coincidence?
twitter.com/...
Probably nothing 😂
14 Feb. 2022
We'll see what happens in the next year for GameStop. Maybe their shareholders who are direct registering their shares with ComputerShare will expose massive corruption and the reality that major hedge funds have illegally shorted/naked shorted the float of GameStop shares multiple times over, because they were never held accountable until now.
Or maybe shorts did cover and people are just long, because they like the company/stock and believe in the new CEO's vision for a turnaround.
16 Feb. 2022
16 Feb. 2022
Shorty mc Short=> For you
j
16 Feb. 2022
@Gunne by chance do you have a phone number for CS. UBS told me they put them in the system and I can’t find away to talk or do a live chat. Just a bot.
R
13 Feb. 2022
Company has negative earnings. What would you pay for/value a company that’s losing money in a declining industry? I think 0 per share since it will probably go bankrupt as companies can’t keep losing money indefinitely and stay in business.
A
14 Feb. 2022
@Ryan Oz I agree, that is why I am recomending a exit from these high levels of $124. A fall is comming.
14 Feb. 2022
@A.Jay
In Wonderland? 🥳
Some say...Sun is shining over there.
14 Feb. 2022
@Ryan Oz then short it.
13 Feb. 2022
The APEs who claimed fundamentals don't matter and all that counted was the MOASS and retail solidarity should have to admit the obvious which is that Short Squeezes have their own fundamentals. How big the float, how much short interest, could the company dilute to raise money if pumped?
You've studied squeezes even if you don't know valuations. Fact is, shorts are long ago alerted and hedged, share are lower than before, and plenty and cheap to borrow.
it's over, hold bags if you need to so reality has time to dawn on you
j
15 Feb. 2022
@kbaba I asked UBS to DRS 10,000 shares 11 days ago and they still refuse to transfer. Next stop SEC and a lawyer.
F
13 Feb. 2022
ah the forget gamestop articles before the opex run up
o
12 Feb. 2022
The stock market is/has become an element of organized crime (GS, JPM, Citadel, Anson,...) when it allows market makers to naked short any stock and use algorithms to force prices down (in some cases to zero). The oversight agencies have ignored the blatant manipulation and basically should be liable as accessories to fraud (impossible dream for them to indict themselves?!).
Pro sports, all-star wrestling, etc., are openly fixed, but I guess the argument is they are entertainment, so nobody cares. However, with gambling expanded nationwide, then fixing games clearly involves interstate fraud.
12 Feb. 2022
=> The oversight agencies have ignored the blatant manipulation and basically should be liable as accessories to fraud (impossible dream for them to indict themselves?!).
Perhaps in the past, but it looks like there's improvement now, no?
Bang that chest, apes 🤞
Anyway, the oversight agencies are a group of people, just like Wall Street/the rich/suits is a group of people.
Generalizing a group of people don't make sense to me.
12 Feb. 2022
Shorts never closed.
You're delusional if you think anyone still believes the illusion (lie) Shorty mc Short created.
-The SEC report 𝗖𝗟𝗘𝗔𝗥𝗟𝗬 stated that the run-up was due to buying by retail, 𝗡𝗢𝗧 shorts buying to close.
--Have a look at the 'shorts covering' volume, and then realize that the short volume during that period was still 20-30 M shares per day. 🤦🏼♂️
--Even FINRA has the short interest still at 94.37% after the buying halt
-Here you have S3 saying that shorts didn't close on 29/1, on CNBC.
That was before they altered the numbers, of course.
-Here you have IBKR stating that GME was still the biggest short position/hardest to borrow, that was in April, mind you.
-Here you have a fine analysis of the official reported short volume, you'll see why they could not have covered, and you'll see why our beloved stonk is the "beast".
www.reddit.com/...
That is only the official shorted volume.
We all know there is plenty more hidden short interest in naked shorts, in ETFs, swaps, options, etc.
-Here you have another analysis that it is mathematically not possible.
-The explanation on the massive puts that were illegally hidden in Brasil
- Shorts supposedly covered/bought them back between the 15-31 January 2021, according to the lying bunch
=>At the time, shares outstanding for Gamestop was 65.3 Million shares
ycharts.com/...
So how come that institutional ownership alone was still at 90 Million shares long after the January spike?
=>Gurufocus, the site that i've found pretty reliable over the years and the site that uses daily updated company data provided by Morningstar, shows that institutional + insiders ownership already exceeds shares outstanding of GME at the time.
You're telling me that retail didn't buy the stock in droves?
Millions, i'd say.
No insiders, too?
Keep on DRSing, only 17.81 Million institutional shares left, according to Gurufocus. Included are probably some/all of RCV/RCs shares.
-Late November, both Thomson One
-And Finviz reported short interest above 100%
-It's one glitch after another
-On top of all the above, an maybe the most interesting counterargument to the "shorts covered/squeeze is over narrative" of them all.
=>While we've seen countless articles/clips telling us, individual retail investors, that the shorts have closed and the squeeze is over since late January/begin February last year.
=>Gamestop started mentioning the squeeze in their SEC filings.
This from June, 2021.
𝐈𝐧 𝐩𝐚𝐫𝐭𝐢𝐜𝐮𝐥𝐚𝐫, 𝐚 𝐥𝐚𝐫𝐠𝐞 𝐩𝐫𝐨𝐩𝐨𝐫𝐭𝐢𝐨𝐧 𝐨𝐟 𝐨𝐮𝐫 𝐜𝐨𝐦𝐦𝐨𝐧 𝐬𝐭𝐨𝐜𝐤 𝐡𝐚𝐬 𝐛𝐞𝐞𝐧 𝐚𝐧𝐝 𝐦𝐚𝐲 𝐜𝐨𝐧𝐭𝐢𝐧𝐮𝐞 𝐭𝐨 𝐛𝐞 𝐭𝐫𝐚𝐝𝐞𝐝 𝐛𝐲 𝐬𝐡𝐨𝐫𝐭 𝐬𝐞𝐥𝐥𝐞𝐫𝐬 𝐰𝐡𝐢𝐜𝐡 𝐡𝐚𝐬 𝐩𝐮𝐭 𝐚𝐧𝐝 𝐦𝐚𝐲 𝐜𝐨𝐧𝐭𝐢𝐧𝐮𝐞 𝐭𝐨 𝐩𝐮𝐭 𝐩𝐫𝐞𝐬𝐬𝐮𝐫𝐞 𝐨𝐧 𝐭𝐡𝐞 𝐬𝐮𝐩𝐩𝐥𝐲 𝐚𝐧𝐝 𝐝𝐞𝐦𝐚𝐧𝐝 𝐟𝐨𝐫 𝐨𝐮𝐫 𝐜𝐨𝐦𝐦𝐨𝐧 𝐬𝐭𝐨𝐜𝐤, 𝐟𝐮𝐫𝐭𝐡𝐞𝐫 𝐢𝐧𝐟𝐥𝐮𝐞𝐧𝐜𝐢𝐧𝐠 𝐯𝐨𝐥𝐚𝐭𝐢𝐥𝐢𝐭𝐲 𝐢𝐧 𝐢𝐭𝐬 𝐦𝐚𝐫𝐤𝐞𝐭 𝐩𝐫𝐢𝐜𝐞. 𝐀𝐝𝐝𝐢𝐭𝐢𝐨𝐧𝐚𝐥𝐥𝐲, 𝐭𝐡𝐞𝐬𝐞 𝐚𝐧𝐝 𝐨𝐭𝐡𝐞𝐫 𝐞𝐱𝐭𝐞𝐫𝐧𝐚𝐥 𝐟𝐚𝐜𝐭𝐨𝐫𝐬 𝐡𝐚𝐯𝐞 𝐜𝐚𝐮𝐬𝐞𝐝 𝐚𝐧𝐝 𝐦𝐚𝐲 𝐜𝐨𝐧𝐭𝐢𝐧𝐮𝐞 𝐭𝐨 𝐜𝐚𝐮𝐬𝐞 𝐭𝐡𝐞 𝐦𝐚𝐫𝐤𝐞𝐭 𝐩𝐫𝐢𝐜𝐞 𝐚𝐧𝐝 𝐝𝐞𝐦𝐚𝐧𝐝 𝐟𝐨𝐫 𝐨𝐮𝐫 𝐜𝐨𝐦𝐦𝐨𝐧 𝐬𝐭𝐨𝐜𝐤 𝐭𝐨 𝐟𝐥𝐮𝐜𝐭𝐮𝐚𝐭𝐞, 𝐰𝐡𝐢𝐜𝐡 𝐦𝐚𝐲 𝐥𝐢𝐦𝐢𝐭 𝐨𝐫 𝐩𝐫𝐞𝐯𝐞𝐧𝐭 𝐢𝐧𝐯𝐞𝐬𝐭𝐨𝐫𝐬 𝐟𝐫𝐨𝐦 𝐫𝐞𝐚𝐝𝐢𝐥𝐲 𝐬𝐞𝐥𝐥𝐢𝐧𝐠 𝐭𝐡𝐞𝐢𝐫 𝐬𝐡𝐚𝐫𝐞𝐬 𝐨𝐟 𝐜𝐨𝐦𝐦𝐨𝐧 𝐬𝐭𝐨𝐜𝐤 𝐚𝐧𝐝 𝐦𝐚𝐲 𝐨𝐭𝐡𝐞𝐫𝐰𝐢𝐬𝐞 𝐧𝐞𝐠𝐚𝐭𝐢𝐯𝐞𝐥𝐲 𝐚𝐟𝐟𝐞𝐜𝐭 𝐭𝐡𝐞 𝐥𝐢𝐪𝐮𝐢𝐝𝐢𝐭𝐲 𝐨𝐟 𝐨𝐮𝐫 𝐜𝐨𝐦𝐦𝐨𝐧 𝐬𝐭𝐨𝐜𝐤. 𝐀 “𝐬𝐡𝐨𝐫𝐭 𝐬𝐪𝐮𝐞𝐞𝐳𝐞” 𝐝𝐮𝐞 𝐭𝐨 𝐚 𝐬𝐮𝐝𝐝𝐞𝐧 𝐢𝐧𝐜𝐫𝐞𝐚𝐬𝐞 𝐢𝐧 𝐝𝐞𝐦𝐚𝐧𝐝 𝐟𝐨𝐫 𝐬𝐡𝐚𝐫𝐞𝐬 𝐨𝐟 𝐨𝐮𝐫 𝐜𝐨𝐦𝐦𝐨𝐧 𝐬𝐭𝐨𝐜𝐤 𝐭𝐡𝐚𝐭 𝐥𝐚𝐫𝐠𝐞𝐥𝐲 𝐞𝐱𝐜𝐞𝐞𝐝𝐬 𝐬𝐮𝐩𝐩𝐥𝐲 𝐡𝐚𝐬 𝐥𝐞𝐝 𝐭𝐨, 𝐚𝐧𝐝 𝐦𝐚𝐲 𝐜𝐨𝐧𝐭𝐢𝐧𝐮𝐞 𝐭𝐨 𝐥𝐞𝐚𝐝 𝐭𝐨, 𝐞𝐱𝐭𝐫𝐞𝐦𝐞 𝐩𝐫𝐢𝐜𝐞 𝐯𝐨𝐥𝐚𝐭𝐢𝐥𝐢𝐭𝐲 𝐢𝐧 𝐬𝐡𝐚𝐫𝐞𝐬 𝐨𝐟 𝐨𝐮𝐫 𝐜𝐨𝐦𝐦𝐨𝐧 𝐬𝐭𝐨𝐜𝐤. 𝐈𝐧𝐯𝐞𝐬𝐭𝐨𝐫𝐬 𝐦𝐚𝐲 𝐩𝐮𝐫𝐜𝐡𝐚𝐬𝐞 𝐬𝐡𝐚𝐫𝐞𝐬 𝐨𝐟 𝐨𝐮𝐫 𝐜𝐨𝐦𝐦𝐨𝐧 𝐬𝐭𝐨𝐜𝐤 𝐭𝐨 𝐡𝐞𝐝𝐠𝐞 𝐞𝐱𝐢𝐬𝐭𝐢𝐧𝐠 𝐞𝐱𝐩𝐨𝐬𝐮𝐫𝐞 𝐨𝐫 𝐭𝐨 𝐬𝐩𝐞𝐜𝐮𝐥𝐚𝐭𝐞 𝐨𝐧 𝐭𝐡𝐞 𝐩𝐫𝐢𝐜𝐞 𝐨𝐟 𝐨𝐮𝐫 𝐜𝐨𝐦𝐦𝐨𝐧 𝐬𝐭𝐨𝐜𝐤. 𝐒𝐩𝐞𝐜𝐮𝐥𝐚𝐭𝐢𝐨𝐧 𝐨𝐧 𝐭𝐡𝐞 𝐩𝐫𝐢𝐜𝐞 𝐨𝐟 𝐨𝐮𝐫 𝐜𝐨𝐦𝐦𝐨𝐧 𝐬𝐭𝐨𝐜𝐤 𝐦𝐚𝐲 𝐢𝐧𝐯𝐨𝐥𝐯𝐞 𝐥𝐨𝐧𝐠 𝐚𝐧𝐝 𝐬𝐡𝐨𝐫𝐭 𝐞𝐱𝐩𝐨𝐬𝐮𝐫𝐞𝐬. 𝐓𝐨 𝐭𝐡𝐞 𝐞𝐱𝐭𝐞𝐧𝐭 𝐚𝐠𝐠𝐫𝐞𝐠𝐚𝐭𝐞 𝐬𝐡𝐨𝐫𝐭 𝐞𝐱𝐩𝐨𝐬𝐮𝐫𝐞 𝐞𝐱𝐜𝐞𝐞𝐝𝐬 𝐭𝐡𝐞 𝐧𝐮𝐦𝐛𝐞𝐫 𝐨𝐟 𝐬𝐡𝐚𝐫𝐞𝐬 𝐨𝐟 𝐨𝐮𝐫 𝐜𝐨𝐦𝐦𝐨𝐧 𝐬𝐭𝐨𝐜𝐤 𝐚𝐯𝐚𝐢𝐥𝐚𝐛𝐥𝐞 𝐟𝐨𝐫 𝐩𝐮𝐫𝐜𝐡𝐚𝐬𝐞 𝐨𝐧 𝐭𝐡𝐞 𝐨𝐩𝐞𝐧 𝐦𝐚𝐫𝐤𝐞𝐭, 𝐢𝐧𝐯𝐞𝐬𝐭𝐨𝐫𝐬 𝐰𝐢𝐭𝐡 𝐬𝐡𝐨𝐫𝐭 𝐞𝐱𝐩𝐨𝐬𝐮𝐫𝐞 𝐦𝐚𝐲 𝐡𝐚𝐯𝐞 𝐭𝐨 𝐩𝐚𝐲 𝐚 𝐩𝐫𝐞𝐦𝐢𝐮𝐦 𝐭𝐨 𝐫𝐞𝐩𝐮𝐫𝐜𝐡𝐚𝐬𝐞 𝐬𝐡𝐚𝐫𝐞𝐬 𝐨𝐟 𝐨𝐮𝐫 𝐜𝐨𝐦𝐦𝐨𝐧 𝐬𝐭𝐨𝐜𝐤 𝐟𝐨𝐫 𝐝𝐞𝐥𝐢𝐯𝐞𝐫𝐲 𝐭𝐨 𝐥𝐞𝐧𝐝𝐞𝐫𝐬 𝐨𝐟 𝐨𝐮𝐫 𝐜𝐨𝐦𝐦𝐨𝐧 𝐬𝐭𝐨𝐜𝐤. 𝐓𝐡𝐨𝐬𝐞 𝐫𝐞𝐩𝐮𝐫𝐜𝐡𝐚𝐬𝐞𝐬 𝐦𝐚𝐲 𝐢𝐧 𝐭𝐮𝐫𝐧, 𝐝𝐫𝐚𝐦𝐚𝐭𝐢𝐜𝐚𝐥𝐥𝐲 𝐢𝐧𝐜𝐫𝐞𝐚𝐬𝐞 𝐭𝐡𝐞 𝐩𝐫𝐢𝐜𝐞 𝐨𝐟 𝐬𝐡𝐚𝐫𝐞𝐬 𝐨𝐟 𝐨𝐮𝐫 𝐜𝐨𝐦𝐦𝐨𝐧 𝐬𝐭𝐨𝐜𝐤 𝐮𝐧𝐭𝐢𝐥 𝐚𝐝𝐝𝐢𝐭𝐢𝐨𝐧𝐚𝐥 𝐬𝐡𝐚𝐫𝐞𝐬 𝐨𝐟 𝐨𝐮𝐫 𝐜𝐨𝐦𝐦𝐨𝐧 𝐬𝐭𝐨𝐜𝐤 𝐚𝐫𝐞 𝐚𝐯𝐚𝐢𝐥𝐚𝐛𝐥𝐞 𝐟𝐨𝐫 𝐭𝐫𝐚𝐝𝐢𝐧𝐠 𝐨𝐫 𝐛𝐨𝐫𝐫𝐨𝐰𝐢𝐧𝐠. 𝐓𝐡𝐢𝐬 𝐢𝐬 𝐨𝐟𝐭𝐞𝐧 𝐫𝐞𝐟𝐞𝐫𝐫𝐞𝐝 𝐭𝐨 𝐚𝐬 𝐚 “𝐬𝐡𝐨𝐫𝐭 𝐬𝐪𝐮𝐞𝐞𝐳𝐞.” 𝐀 𝐥𝐚𝐫𝐠𝐞 𝐩𝐫𝐨𝐩𝐨𝐫𝐭𝐢𝐨𝐧 𝐨𝐟 𝐨𝐮𝐫 𝐜𝐨𝐦𝐦𝐨𝐧 𝐬𝐭𝐨𝐜𝐤 𝐡𝐚𝐬 𝐛𝐞𝐞𝐧 𝐚𝐧𝐝 𝐦𝐚𝐲 𝐜𝐨𝐧𝐭𝐢𝐧𝐮𝐞 𝐭𝐨 𝐛𝐞 𝐭𝐫𝐚𝐝𝐞𝐝 𝐛𝐲 𝐬𝐡𝐨𝐫𝐭 𝐬𝐞𝐥𝐥𝐞𝐫𝐬 𝐰𝐡𝐢𝐜𝐡 𝐦𝐚𝐲 𝐢𝐧𝐜𝐫𝐞𝐚𝐬𝐞 𝐭𝐡𝐞 𝐥𝐢𝐤𝐞𝐥𝐢𝐡𝐨𝐨𝐝 𝐭𝐡𝐚𝐭 𝐨𝐮𝐫 𝐜𝐨𝐦𝐦𝐨𝐧 𝐬𝐭𝐨𝐜𝐤 𝐰𝐢𝐥𝐥 𝐛𝐞 𝐭𝐡𝐞 𝐭𝐚𝐫𝐠𝐞𝐭 𝐨𝐟 𝐚 𝐬𝐡𝐨𝐫𝐭 𝐬𝐪𝐮𝐞𝐞𝐳𝐞. 𝐀 𝐬𝐡𝐨𝐫𝐭 𝐬𝐪𝐮𝐞𝐞𝐳𝐞 𝐡𝐚𝐬 𝐥𝐞𝐝 𝐚𝐧𝐝 𝐜𝐨𝐮𝐥𝐝 𝐜𝐨𝐧𝐭𝐢𝐧𝐮𝐞 𝐭𝐨 𝐥𝐞𝐚𝐝 𝐭𝐨 𝐯𝐨𝐥𝐚𝐭𝐢𝐥𝐞 𝐩𝐫𝐢𝐜𝐞 𝐦𝐨𝐯𝐞𝐦𝐞𝐧𝐭𝐬 𝐢𝐧 𝐬𝐡𝐚𝐫𝐞𝐬 𝐨𝐟 𝐨𝐮𝐫 𝐜𝐨𝐦𝐦𝐨𝐧 𝐬𝐭𝐨𝐜𝐤 𝐭𝐡𝐚𝐭 𝐚𝐫𝐞 𝐮𝐧𝐫𝐞𝐥𝐚𝐭𝐞𝐝 𝐨𝐫 𝐝𝐢𝐬𝐩𝐫𝐨𝐩𝐨𝐫𝐭𝐢𝐨𝐧𝐚𝐭𝐞 𝐭𝐨 𝐨𝐮𝐫 𝐨𝐩𝐞𝐫𝐚𝐭𝐢𝐧𝐠 𝐩𝐞𝐫𝐟𝐨𝐫𝐦𝐚𝐧𝐜𝐞 𝐨𝐫 𝐩𝐫𝐨𝐬𝐩𝐞𝐜𝐭𝐮𝐬 𝐚𝐧𝐝, 𝐨𝐧𝐜𝐞 𝐢𝐧𝐯𝐞𝐬𝐭𝐨𝐫𝐬 𝐩𝐮𝐫𝐜𝐡𝐚𝐬𝐞 𝐭𝐡𝐞 𝐬𝐡𝐚𝐫𝐞𝐬 𝐨𝐟 𝐨𝐮𝐫 𝐜𝐨𝐦𝐦𝐨𝐧 𝐬𝐭𝐨𝐜𝐤 𝐧𝐞𝐜𝐞𝐬𝐬𝐚𝐫𝐲 𝐭𝐨 𝐜𝐨𝐯𝐞𝐫 𝐭𝐡𝐞𝐢𝐫 𝐬𝐡𝐨𝐫𝐭 𝐩𝐨𝐬𝐢𝐭𝐢𝐨𝐧𝐬, 𝐭𝐡𝐞 𝐩𝐫𝐢𝐜𝐞 𝐨𝐟 𝐨𝐮𝐫 𝐜𝐨𝐦𝐦𝐨𝐧 𝐬𝐭𝐨𝐜𝐤 𝐦𝐚𝐲 𝐫𝐚𝐩𝐢𝐝𝐥𝐲 𝐝𝐞𝐜𝐥𝐢𝐧𝐞. 𝐈𝐧𝐯𝐞𝐬𝐭𝐨𝐫𝐬 𝐭𝐡𝐚𝐭 𝐩𝐮𝐫𝐜𝐡𝐚𝐬𝐞 𝐬𝐡𝐚𝐫𝐞𝐬 𝐨𝐟 𝐨𝐮𝐫 𝐜𝐨𝐦𝐦𝐨𝐧 𝐬𝐭𝐨𝐜𝐤 𝐝𝐮𝐫𝐢𝐧𝐠 𝐚 𝐬𝐡𝐨𝐫𝐭 𝐬𝐪𝐮𝐞𝐞𝐳𝐞 𝐦𝐚𝐲 𝐥𝐨𝐬𝐞 𝐚 𝐬𝐢𝐠𝐧𝐢𝐟𝐢𝐜𝐚𝐧𝐭 𝐩𝐨𝐫𝐭𝐢𝐨𝐧 𝐨𝐟 𝐭𝐡𝐞𝐢𝐫 𝐢𝐧𝐯𝐞𝐬𝐭𝐦𝐞𝐧𝐭.
Hedgies R f*ck
And GME goes moon, well deserved by the way.
Not only because of them shorts, but also because of the potential, and the whole story that brought us here.
Thou shall stop lying to and stop stealing from your fellow country citizens.
Illegally Shorting America
Was never a bright idea, in the first place.
M
12 Feb. 2022
@Gunne sometimes less is more.
12 Feb. 2022
@Moomoo22u2
More ore less, but in this case i'll make an exception 😉
TO DA MOON.
12 Feb. 2022
@Gunne Dude, lets say your narrative is true. Still doesn't mean any kind of squeeze is likely. If it hasn't need triggered yet, it's not coming. If there are greater forces controlling the market against you, they are winning and will continue. Cause there's been plenty of opportunity and GME is now $125, so what's the point. it's heading more down all the time
12 Feb. 2022
The most commical part of the GME story is those reddit kids literally exchanged the old shorts $5 short positions and changed them in for $400 short positions putting them the big boys who always win in massive profit. Now they sit dreaming of another short? LOL the shorts are all on house...Robinhood investors dime at least until $300 bucks. .
Honestly reading the longs posts reminds me of being a young parent watching my kids play soccer. They did it poorly but was cute none the less to see them try.
w
12 Feb. 2022
The author’s credibility is worthless since he doesn’t take into account the turnaround story that is happening in GME in the last year. Without making a big fuss, almost behind dark curtains Ryan Cohen is transforming the company. Just look at his hires and moves. He is a beast that knows to recognize potential and is moving the company to NFTs, crypto and other gaming platforms. Only because of that I would not bet against GME. I for one made huge sums last year, twice. But after that started accumulating stock below 100 and am betting on Cohen and his moves.
12 Feb. 2022
@whyzih Yet 3 quarters into Cohen they keep losing money.
w
13 Feb. 2022
@Platypuss* what is 3 quarters when you are transitioning and transforming a company?? it’s nothing, at least in my eyes. If the company becomes a 100B company, that is a 10 bagger from here, who is going to remember the 3 quarters? You know how long big companies were losing money (netflix, amazon). Don’t get me wrong, I don’t know that any of this would happen. All I’m saying is, things are in motion, and I want to be part of this story if and when it happens.
K
16 Feb. 2022
@Platypuss* Amazon had its first profitable quarter in 2003, almost 10 years after founding. Tesla was founded in 2003 and had it's first profitable year in 2021... 17 years after its founding.
t
12 Feb. 2022
It helps to read the above 14 comments to know that zombie longs, are what they are because they do not understand stock investing and their basis for being long does not make sense. This will be a $40 stock but likely within 1-3 years? We will find out.
Hey, make your bets, take your chances.
12 Feb. 2022
@trzeuske what part of the long thesis doesn’t make sense? One of their newly announced partners has a roadmap to $3 billion in sales over the next couple of years, more announcements are coming, there is a refocus on e-commerce fulfillment and customer service. Cohen has a track record and has brought on a team of experienced executives from Chewy, Amazon, etc.
Why is the company worth just the cash on its balance sheet at $40? Go long here, the market cap is half of OpenSea with a trusted platform coming.
12 Feb. 2022
@Nospheritu
You know what part they will come up with...
A dying brick n mortar... 🥳
At the same time, Amazon plans to open large retail locations akin to department stores
Interesting thesis this sell-side has 🙃, its getting too weird to express in usual terms.
U
12 Feb. 2022
@trzeuske If I had to guess, you're likely ignorant of the settlement system that underlies "stock investing". Ignorant of the fact that when you buy stock through a broker-dealer it's actually just an IOU and that 90-95% of retail orders are executed off-exchange. Ignorant of that 70% of GoldmanSach's prime brokerage income comes from "locating" hard to borrow shares. The entirety of the locate system is wrought with corruption and loopholes that allow the big boys to create large numbers of FTDs and continually kick the settlement date down the road. Heck, hedge funds can even use swaps to create short positions that aren't on their books (as they're on the prime-broker's books). Once all of GameStop's float is out of the DTCC (because enough people decide they want to OWN the stock they bought through DRS'ing), it'll be really interesting to see if the short position is really "closed".
But even ignoring all of that, the company is undergoing a fundamental transformation which is yet to be appreciated by most analysts. How you came to $40 as the target price for a growing e-commerce company (which is entering the tech space of digital gaming/NFTs) with an established 50million+ customer base that has no debt and $20/share is cash on hand, is beyond me.
12 Feb. 2022
Dear tin foil hat wearing diamond handed apes. I would bet money there is a big money silent partner behind an army of idiots openly bragging about illegally manipulating a stock with brokerage accounts averaging less than $500. That said the reason why the short squeeze worked last year was SUPRISE...the funds making rationale bets against a money hemorrhaging business running a dying business model assumed they would be protected from a manipulated short squeeze because it's ILLEGAL. Their mistake was in relying on the law and SEC to protect their legit market activity.
The short squeeze last year was a ONE shot opportunity...as if the blood bath in GME and AMC wasn't enough to tip shorts off to the possibility of being burned by an ILLEGAL coordinated short squeeze attempt...the apes CAN'T STOP TALKING about their attempt to MANIPULATE the stocks again. Please keep your pretzel logic evidence that reported short interest is fake to yourselves...your evidence is what is what is fake and I'm not going to chase my tail debating fake evidence of a fake conspiracy theory. Short interest has declined because the shorts got the message... the law and SEC won't protect them from making a logical bet that a cash hemorrhaging business running a dying business model is not worth more than a lottery ticket bet they MIGHT figure something else out before it's to late.
12 Feb. 2022
@Milkweed we don’t need a short squeeze to double the stock price within a year when the digital marketplace launches. A few years later at scale, we will see profitability and a flywheel effect. This is a long term hold and we’re not even at the beginning of the story.
12 Feb. 2022
@Nospheritu There are already established digital distributors of games with more resources than GME. At best GME MIGHT beat the odds and hang around as an also ran in the digital market. which is what the single digit stock price was assuming before APES (and their silent partner) manipulated a short squeeze and turned GME into a meme stock. Gravity is already setting in and will continue to do so. They're ALREADY burning through the cash they raised and this is with the tail wind of a console refresh cycle at their back. The cash only delays the inevitable (at best). It doesn't solve anything...ditto selling holograms.
12 Feb. 2022
@Milkweed One shot opportunity, that is a very good way to put it and its honestly the truth.
They will learn by not ringing the register and letting greed take over the trade
I
12 Feb. 2022
As @Aeeueue eae mentioned below, the author didn't address the failure to deliver rate as well as the millions of unaccounted for phantom shares that exist in GameStop. Regardless of all that, the author's mistaken belief that GameStop's core business is dying and continued reference to Blockbuster shows that this author has not done any research into the company, or its future revenue goals. The author is to be taken as seriously as ETH 2.0's release date.
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