GameStop Corp on Monday increased the value of new stock it may sell from $100 million to $1 billion, as the U.S. video game retailer seeks to capitalize on a surge in its shares from a Reddit-driven rally this year.
GameStop stock has rampaged over 900% higher since January in highly volatile trading as amateur investors organized on social media sites such as Reddit staged a stubborn buying spree, winning out over Wall Street hedge funds that had shorted its shares.
GameStop’s shares fell as much as 13.9% on Monday, but reversed course and traded up slightly, standing at $192.29 apiece at 11:36 a.m. EDT.
The company has not sold any new shares since the frenzy started, mainly because security laws prevented it from doing so without disclosing its latest financial information, Reuters reported in February.
GameStop reported fourth-quarter earnings on March 24, and on Monday it published unaudited sales results for its fiscal first quarter to date, to bring investors up-to-date with its financial situation.
GameStop said it may sell up to 3.5 million shares worth no more than $1 billion, and use the proceeds to hasten its shift to e-commerce in an overhaul being led by billionaire Ryan Cohen, GameStop’s biggest shareholder and board member.
In a regulatory filing for the offering, Grapevine, Texas-based GameStop addressed the extreme gyrations in its shares in the last three months, which have swung from as low as $19.94 to as high as $347.51.
«During this time, we have not experienced any material changes in our financial condition or results of operations that would explain such price volatility or trading volume,» GameStop said.
«Investors that purchase shares of our common stock in this offering may lose a significant portion of their investments if the price of our common stock subsequently declines.»
GameStop had registered in December with the U.S. Securities and Exchange Commission (SEC) to sell $100 million worth of stock through an at-the-market offering (ATM), which it never deployed.
GameStop Corp on Monday increased the value of new stock it may sell from $100 million to $1 billion, as the U.S. video game retailer seeks to capitalize on a surge in its shares from a Reddit-driven rally this year.
GameStop stock has rampaged over 900% higher since January in highly volatile trading as amateur investors organized on social media sites such as Reddit staged a stubborn buying spree, winning out over Wall Street hedge funds that had shorted its shares.
GameStop’s shares fell as much as 13.9% on Monday, but reversed course and traded up slightly, standing at $192.29 apiece at 11:36 a.m. EDT.
The company has not sold any new shares since the frenzy started, mainly because security laws prevented it from doing so without disclosing its latest financial information, Reuters reported in February.
GameStop reported fourth-quarter earnings on March 24, and on Monday it published unaudited sales results for its fiscal first quarter to date, to bring investors up-to-date with its financial situation.
GameStop said it may sell up to 3.5 million shares worth no more than $1 billion, and use the proceeds to hasten its shift to e-commerce in an overhaul being led by billionaire Ryan Cohen, GameStop’s biggest shareholder and board member.
In a regulatory filing for the offering, Grapevine, Texas-based GameStop addressed the extreme gyrations in its shares in the last three months, which have swung from as low as $19.94 to as high as $347.51.
«During this time, we have not experienced any material changes in our financial condition or results of operations that would explain such price volatility or trading volume,» GameStop said.
«Investors that purchase shares of our common stock in this offering may lose a significant portion of their investments if the price of our common stock subsequently declines.»
GameStop had registered in December with the U.S. Securities and Exchange Commission (SEC) to sell $100 million worth of stock through an at-the-market offering (ATM), which it never deployed.
