GameStock (GME) stock has started its way higher again, gaining over 100% yesterday.
GameStop Corp (NYSE: GME) saw its share price surging by 103% on Wednesday as investors reacted positively to the resignation of the financial chief officer of the company. The shares also took another 83% surge in the after-hours trade of Wednesday according to the available data. The investors proceeded to push the price of the premarket trade on Thursday with a 44% surge. As the trading is going on today, GME stock is rising by 51% now.
It is said that investors and traders are hoping for a resurgence amid the expected resignation of the financial Chief Officer Jim Bell. It was disclosed that the decision was forced by the board and Ryan Cohen, a GameStop Corp investor and the co-founder of Chewy, an online pet and food retailer. This is expected to be done on March 26.
In a filing with the Securities and Exchange Commission (SEC), the company denied all allegations of forcing Bell out due to a disagreement on something related to the company’s operation. They stated emphatically that the resignation has nothing to do with contention relating to GameStop’s policies, operation, or practices which include accounting principles and practices. This is contrary to the reports that Cohen spearheaded an attack to get him out of the company to execute the transition online.
Cohen owns over 12% of the stocks of GameStop Corp through his company RC Ventures. Somewhere in November 2020, Cohen allegedly wrote a letter to the board of GameStop criticizing the executive team to force them to build a perfect e-commerce platform. In the letter, he stated that GameStop (GME) needs to evolve into a technological company that delights investors. Not just that, it should also deliver a top-notch digital experience instead of priding itself in being just a video retailer that only focuses on a brick-and-mortar footprint. Bell was the first casualty of Cohen’s leadership shakeup.
Jeffery Equity Thinks Bell Have No Issue with GameStop (GME)
Jefferies Equity analyst, Stephanie Wissink in a statement to the client’s acknowledged the effort of Bell during his tenure in the administrative setup of the company. It can be recalled that there was a sharp fall in sales during the late stages of the final hardware cycles. During that period, Mr. Bell led a series of actions that helped to protect the GME equity.
Wissink believes that the expected resignation of Bell was mutual, none Immediate, and not a product of misunderstandings or disagreement between him and the board as activist settlement mostly follows leadership changes. It was also disclosed that instead of looking for a CFO replacement with a retail background, the company will consider someone with a tech background as their primary focus is on e-commerce growth.
Bell refused to comment on the reports of his resignation. Currently, the company has consulted an executive search firm to find a Financial Chief who has the ability and the qualification to drive the company to its expected transformation.
Excellent John K. Kumi is a cryptocurrency and fintech enthusiast, operations manager of a fintech platform, writer, researcher, and a huge fan of creative writing. With an Economics background, he finds much interest in the invisible factors that causes price change in anything measured with valuation. He has been in the crypto/blockchain space in the last five (5) years. He mostly watches football highlights and movies in his free time.