Meme stock hype dies down
GameStop and AMC are shedding that unprecedented Reddit day-trader chatter and those eye-popping stock swings — two defining factors for the meme stock cohort.
Why it matters: The hype for the OG meme stocks at the center of the pandemic-era phenomenon has died out.
The latest: GameStop’s stock dived 10% Thursday after the video game retailer disclosed it had been subpoenaed by the SEC related to an investigation into stock trading activity.
- But there hasn’t been a plunge that steep since June — one sign that wild swings (to the downside or upside) have become less common.
By the numbers: A five-day moving average of GameStop's stock moves over the past year shows a daily shift of roughly 5%, as of Thursday. In February, that was as high as 74%.
- By that same metric, AMC's stock has swung 5% (after an average 40% move as recently as June.)
Reality check: Both stock prices are off their Reddit-fueled all-time highs, but they remain at nosebleed levels.
What they’re saying: The meme trade isn’t fizzling out, Youyang Gu, who created YoloStocks, a real-time tracker of r/WallStreetBets activity, tells Axios. (No, he isn’t one of the active, at-home meme stock traders.)
- GameStop “is still up 800% for the year and AMC is still up 1,400%. It’s just a matter of time before we get another ‘bounce.’ Just have to be patient,” Gu says.
The intrigue: There’s a sharp contrast in how GameStop and AMC executives have handled all the retail trader attention.
- Adam Aron, the theater chain’s CEO, has leaned all the way in even going so far as polling Twitter followers on which cryptocurrency it should accept next — a possible factor that might be keeping its meme fever alive.
- GameStop executives, on the other hand, have taken the opposite approach — with no direct, public engagements with retail shareholders. (They don't even take questions on earnings calls, after regularly doing so in years past.)
The bottom line: Meme stock-like attention isn’t over. But it’s shifted beyond its most famous symbols.
- GameStop still made up the biggest share of Reddit stock mentions yesterday. Right behind it: Microsoft and Tesla.