GameStop GME shares extended gains Monday amid reports that the video game retailer will ask Chewy.com (CHWY) – Get Report founder Ryan Cohen to lead its e-commerce strategy.
GameStop said Monday that it has created an inter-company committee, which includes Cohen, to “identify initiatives that can further accelerate the Company’s transformation” that includes hiring a chief technology officer, two executive to lead e-commerce and fulfillment functions and forming a search committee for a new CFO.
GameStop shares have rocketed more than 590% since January 12, when the company reached an agreement with Cohen’s RC Ventures LLC to re-structure its board and focus on digital sales and not simply “remain a videogame retailer that overprioritizes its brick-and-mortar footprint and stumbles around the online ecosystem.”
Bloomberg reported Monday that Cohen will lead the group’s shift towards e-commerce and online sales, a move that follows the announced departure of CFO Jim Bell late last month.
GameStop shares were marked 11.23% higher in early Monday trading to change hands at $154.14 each. That move, however, still leaves the stock a long way from its January 27 high of $483.00 each when its shares were trapped in a vortex of Reddit-fueled retail buying linked to discussions on the r/Wallstreetbets chatroom that targeted short-sellers of the money-losing retailer.
The surge in GameStop shares, along with a host of other so-called ‘meme stocks’ such as AMC Entertainment (AMC) – Get Report Bed, Bath & Beyond (BBBY) – Get Report and Kohl’s Corp. (KSS) – Get Report ultimately lead to a Congressional hearing into the nature of short-selling, retail trading and the influence of online chatrooms on market transparency.
Short interest in GameStop shares remains active, according to data from S3 Partners, with bets against the stock tabbed at $1.888 billion, or 27.7% of the outstanding float.
Betting against GameStop has been a losing proposition this year, however, with shorts losing more than $5 billion on a mark-to-market basis, according to S3’s Ihor Dusaniwksy.