When investors thought that the GameStop (NYSE: GME) short-squeeze was over just as it started, GME shares showed signs of potential future gains driven by market speculation, causing more short squeezes, albeit smaller ones.
Now, it seems that something factual sent GME stock soaring in the pre-market. It added 15% in pre-market trading, taking its price from $19 on Friday, to almost $22 at the time of writing.
This surge marks the largest daily surge since May 20, when GME stock added 20% in the intraday trading and reached the $24 mark before devaluation.
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Completion of the market equity offering sent GME stock soaring
GameStop announced the successful completion of its ‘at-the-market’ equity offering program (ATM Program).
The program, which had been previously disclosed, involved selling 45 million shares and allowed the company to raise approximately $933.4 million before commissions and offering expenses.
GameStop initially announced the ATM Program on May 17 by filing a prospectus supplement with the U.S. Securities and Exchange Commission (SEC).
The filing stated that GameStop intended to offer and sell up to 45 million shares of its common stock over time.
GameStop specified that the net proceeds would be used for general corporate purposes, including potential acquisitions and investments.
Short interest in GME stock still remains high
GME stock has a short interest of 21.84%, raising the possibility of a short squeeze as the stock price surged over 15% in pre-market trading. If this gain holds until the market opens, many short positions could be liquidated, with an average coverage period of 1.66 days.
Because actual news about GameStop’s completion of the market equity offering sent GME stock soaring, the gains are expected to continue into today’s trading session, spelling bad news for short-sellers.
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