While many stocks in the market have been struggling — especially in growth — GameStop (NYSE:GME) hasn’t been one of them. That’s ironic, as most of last year’s short-squeeze candidates have rolled over in tremendous pain. And while GME stock also suffered a large drop, it’s been on the move lately.
Shares ripped off 10 straight daily rallies from the March low. Amid the rally, it amassed a 143% return from the recent low to last month’s high. While it has now cooled off a bit — down 24% from the high, investors are wondering if this stock still has short-squeeze potential. Acting as potential catalysts, there has been good news recently.
Furthermore, GameStop chairman and former Chewy (NYSE:CHWY) CEO, Ryan Cohen, recently bought 100,000 shares of GME stock, boosting his stake in the company up to 11.9%. Another large buyer of the company is Bill Pulte, who tweeted that he, “Just made six figure buy on GameStop.”
Will some big-name purchasers in GME stock be enough to get another short-squeeze storm brewing? Perhaps, but the company took another step in potentially making it happen: A stock split.
On March 31, GME announced its plans for a stock split, calling “for an increase in the number of authorized shares of Class A common stock from 300,000,000 to 1,000,000,000.” It’s a more complex stock split than what we’re seeing with recent companies such as Amazon (NASDAQ:AMZN) and Alphabet (NASDAQ:GOOGL, NASDAQ:GOOG). However, bulls are hoping it has the same effect on all three, which is a higher stock price.
While GME stock has been volatile over the past 15 months, it still remains notably higher. Over the last two weeks, its stock has dropped almost 24%. Going back even further, though, the stock is up more than 650% since the start of 2021. In that regard, it’s hard to rule out that another short-squeeze is impossible. Particularly with the vigor that it traded with in late March.
On the date of publication, Bret Kenwell did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.