GameStop (NYSE: GME), one of the stocks that marked the 2021 meme-stock craze, surged almost 10% in premarket trading on Thursday, September 28, after the company released a major announcement.
Notably, the video game and electronics retailer announced it has appointed billionaire activist Ryan Cohen as the company’s new CEO. Cohen would not receive any compensation for his work as GameStop’s Chief Executive.
“GameStop Corp. today disclosed that its Board of Directors has elected Ryan Cohen as President and Chief Executive Officer, effective immediately. Mr. Cohen will not receive compensation for serving as the Company’s President, Chief Executive Officer and Chairman.”
– GameStop wrote in the announcement.
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What happened?
Let’s rewind a bit.
Three months ago, GameStop fired CEO Matthew Furlong without specifying the reasons behind the decision. At the same time, the retailer made Cohen Executive Chairman.
Now, the 38-year-old billionaire will relinquish that position as he takes on GameStop’s top role.
Over the years, Cohen became famous as the “king” of meme stocks. In 2020, he acquired a stake in the gaming retailer, and joined the company’s board a year later, when the meme-stock mania reached its peak.
But since that period, GameStop struggled to witness significant growth turnaround, although it reported a narrower loss and slight revenue increase in the latest fiscal quarter.
Earlier this year, Cohen launched another activist campaign, targeting another retail company, Nordstrom. The move came after the luxury department store’s underperformance compared to both the broader market and its peers, with its share price value crashing 75% over the past 5 years.
GameStop stock price analysis
At press time, shares of GameStop are standing at $18.75 in Thursday’s premarket, up 9.33%. The stock closed 2.2% higher a day earlier at $17.15.
Over the past week, GME lost more than 2.7% and around 1.1% on the monthly chart. The retailer’s shares are also in the red on a year-to-date basis, declining roughly 8%.
Depending on whether it upholds its premarket gains, GME currently faces a resistance level at around $18.5, followed by a confluence resistance zone formed by 100-day and 200-day moving averages (MAs) at $20.75-$21.34.
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