Keith Gill, the internet personality known as “Roaring Kitty” or “Deep F***ing Value,” saw his potential billionaire status slip away as GameStop Corp. GME shares plummeted 12% on Monday.
Gill, a central figure in the 2021 meme stock frenzy and its 2024 resurgence, recently updated his GameStop holdings on Reddit’s r/SuperStonk channel. His position remains unchanged at 5 million shares and 120,000 call options expiring on June 21, with a total value of $235.46 million.
However, on Monday, Gill posted a "Guy Pointing To Himself In The Mirror" meme with the text, "YOU WERE A BILLIONAIRE."
See Also: Best Meme Stocks
What Happened: According to market tracker Unusual Whales, “briefly last week, it appeared possible for Gill to become a billionaire if GameStop [GME] held above $65.”
"Shares were estimated worth $325,000,000 and his calls with IV [intrinsic value] explosion might have been worth $699,600,000," it posted on X.
But GameStop and CEO Ryan Cohen had different plans. Before the Friday market opened, the company released disappointing first-quarter results earlier than expected. Additionally, a surprise announcement of a 75 million share offering sent the stock price crashing nearly 40%.
Even Gill’s YouTube livestream couldn’t stop the slide, though it did confirm his identity behind the social media memes and screenshots.
Roaring Billionaire? The 5 million GameStop shares owned by Gill are now valued at $124.15 million and 120,000 call options with a strike price of $20, exercisable on June 21, are now worth $81.9 million as per his latest screenshot.
With each call option representing 100 shares, Gill would potentially acquire the right to buy 12 million GameStop shares at $20 if they closed above that price on June 21.
That would leave Gill with 17 million shares, making him the fourth-biggest shareholder in the company behind Vanguard, BlackRock, and Cohen's RC Ventures, as per CNBC.
If the stock then hits $58.82, that would push Gill into the billionaire territory.
But reaching that status wouldn’t be without significant investment. As CNBC points out, Gill would have effectively spent over $400 million (including the option premiums, initial share purchase cost, and the notional value of exercising the options).
Financial influencer Anthony Pompliano last week commented on Gill's fleeting billionaire possibility, highlighting the dramatic turn of events. “From blowing up billionaires’ funds to becoming one himself. Insane,” he remarked.
Online betting communities, however, are far from bullish on the prospects.
What Next? Following the company’s fourth-quarter earnings in March, Wedbush analysts expressed concern about a shift to software sales, declining hardware sales, and fewer major console releases.
They warned that a revenue decline of $120 million to $200 million annually could threaten the company’s survival, even predicting its demise “later this decade.” Additionally, GameStop faces stiff competition from Amazon, Microsoft, Walmart, and Nintendo.
The upcoming annual shareholder meeting on June 13th could be a potential turning point. However, without another major catalyst like the one Gill provided in 2021, a near-term stock resurgence appears unlikely.
Price Action: GameStop shares closed Monday down over 12% at $24.83, but were up 0.8% in the after-hours session, according to data from Benzinga Pro.
Image made via photos on Shutterstock
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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