Shares in GameStop Corp (NYSE:GME), the darling of Reddit’s r/wallstreetbets forum, surged on Monday after the video game retailer tapped one of its major shareholders, activist investor Ryan Cohen, to head a new committee that will help it transition into an e-commerce business.
Cohen has risen to prominence recently by issuing a number of cryptic tweets that have been frantically decoded by Reddit’s retail traders for any signs of his strategy regarding GameStop, often resulting in strong surges in the value of the stock.
Last Friday, Cohen’s tweet of a Nauseated Face emoji and a screenshot of a video of a puppet dog sent the shares surging despite the lack of any new information, while a prior tweet of a McDonald’s ice cream cone and a frog emoji garnered a similar response, much to the bemusement of market analysts.
However, in this instance, the reason for the surge appears more fundamental, as Cohen will serve as chair of the Strategic Planning and Capital committee, which will also be comprised of board members Alan Attal and Kurt Wolf.
The committee is aiming to shift GameStop towards a digital business model as bricks and mortar video game stores become increasingly pressured by the rise of digital gaming and online shopping.
Shares in the company jumped 13.5% to US$156.30 in mid-morning deals in New York.