GameStop shares slide as meme stock fervor fades

Investor appetite for “meme stocks” may already be waning. 

The shares of GameStop, AMC Entertainment, BlackBerry and other companies embraced by retail traders dipped on Wednesday morning before financial markets opened in the U.S. The stocks had surged the previous day after Keith Gill, known online by his handle “Roaring Kitty,” resurfaced on X (formerly Twitter) after a three-year hiatus.

Meme stocks are companies whose shares are lifted by social media buzz rather than traditional financial fundamentals such as growth and profits. 

Gill, who has a large following on social media platforms, became the face of meme stock traders in 2021 after he bought shares of GameStop, a video game retailers, for $53,000 and turned it into a multi-million stake amid growing hype around the stock. 

After soaring more than 130% earlier this week, GameStop shares were down 9% to $44.17 in pre-market trading. AMC, a theater chain, dipped 8.3%; business software maker BlackBerry fell 2%; and Virgin Galactic, Richard Branson’s space flight company, slipped 8%.

Wall Street analysts have warned about the risks of investing in highly volatile meme stocks, which typically belong to money-losing companies.