In yet another testament to the power of retail investors in the markets, shares of Esports Entertainment (NASDAQ:GMBL) popped 5% higher today after Citron Research published a report saying GameStop (NYSE:GME) should purchase the online gambling company. GMBL stock also saw increased trading volume, with more than 16 million trades for the day, compared with an average daily volume of just over 1 million trades.
While the pairing might seem unexpected at first, Citron Research editor Andrew Left says it makes sense because if there’s two things GameStop shareholders love, it’s video games and gambling. Left sees this as a way for GME to both pivot away from its declining retail brick-and-mortar stores and monetize its wide customer database.
Esports Entertainment is one of a number of online gambling stocks that have benefited from our socially distanced lives. Earlier this week, Singular Research said that the company’s recent acquisitions, coupled with the boom in e-sports and increased legalization of online gambling, gave the company “long runway growth potential.”
The comment on GME was something of a surprise coming from Citron Research and analyst Andrew Left. Those interested in the “Gamestonks” saga may remember Citron said it would stop publishing short-selling research after Left was the target of intense online harassment for his stance on GameStop back in January.
On the date of publication, Vivian Medithi did not have (either directly or indirectly) any positions in the securities mentioned in this article.