The Return of The Meme Stock - Roaring Kitty is back!

The return of Roaring Kitty brings momentum to the GameStop share price.

While the movie “Dumb Money” has entertained, and in some cases thrilled, fans and viewers, a tweet from Monday may have evoked a sense of hysteria among fans and beads of sweat among short sellers that has been missing for a good 3 years. Because Roaring Kitty, a.k.a. Keith Gills is back on after years of absence.

Who is Roaring Kitty, some readers may be asking themselves at this point. He is responsible for the GameStop (A0HGDX) share price explosion and perhaps the most notorious short squeeze (at least when it comes to retail vs. professional investors) during the COVID Meme Stock Hype in 2021.

The rising stock price during the Short Squeeze increased the value of his investment from about USD 53,000 to nearly USD 50,000,000. He brought attention to the stock on the Reddit community r/wallstreetbets.

So the notorious Roaring Kitty is back, with an interesting result: GameStop surged by as much as 110 percent on Monday. The rally in GameStop's stock, which has been ongoing for two weeks now, receives fresh momentum at the beginning of the week. Following the intense pressure on short-sellers recently, who likely contributed to the significant rise in the stock price, the stock gains another 20 percent on Monday.

But what exactly happened? In the early hours of Monday, Gill made a cryptic post on the messaging service X. The image posted under the username Roaring Kitty depicts little more than a person sitting with a video game controller in hand.

The message, which has been viewed millions of times and shared thousands of times, quickly circulated in relevant forums and subreddits, and is celebrated by GameStop and meme stock fans alike – accompanied by the hope for another surge in the stock. This surge does not take long to materialize on Monday: after the stock already gained 20 percent in weekend trading on the retail broker Robinhood, it also began trading on European exchanges with corresponding increases. Shortly after the opening of U.S. trading, the price continued to rise relentlessly, currently up to 110 percent.

This is likely to put short-sellers, representing 24 percent of the stock with short positions, under pressure again, after the stock had more than doubled from its double bottom at $9.95 on Friday.

My two cents

If the excitement continues at the beginning of the week, other meme stocks could benefit as well. The post on X was not only picked up by GameStop fans, but also by supporters of other stocks, such as the cinema stock AMC Entertainment and BlackBerry. How do I know that? I am a reddit user and a regular visitor at r/wallstreetbets. Why? Many of the investment ideas are certainly anything but nailed down. However, it would be foolhardy to distinguish the power of the masses (especially after the GameStop Short Squeeze). I therefore consider it sensible to be regularly informed in the area of retail investors as well.

Other stocks could be potential targets of these Meme Stock Hunters. If I had to guess, stocks like Warner Bros Discovery (WBD / A3DJQZ) could be a great target. Users/subscribers of r/roaringkitty also talk about Canopy Growth (A3E2FV) and Faraday Future Intelligent Electric (A403N5).

Would I buy into the hype? Not at this point. After massive initial gains, the volatility is too high for me investment approach. But in case Roaring Kitty makes a return on Youtube highligting a specific stock, I may be tempted.

#tothemoon 

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