MemeMoney: The meme stocks welcomed an old friend back to the fun after the markets closed
More like Memevember, right?
Watching ur-meme stocks GameStop
and AMC Entertainment
take flight on Monday, it felt like something was afoot in the world of retail investors, where exuberance about some meme stocks can easily be transferred to others. And like birds heading south for the winter, meme stocks are indeed flocking in formation, with GameStop and AMC providing drafting room for some other names.
After Tuesday’s wild action from Avis Budget Group Inc.
shares in original Meme Pack member Bed Bath & Beyond Inc.
exploded by 67% in after-hours trading, and AMC popped 6% in the extended session, lining up in formation for takeoff.
For Bed Bath & Beyond, the news that appeared to cause the commotion was an announced partnership with grocery chain Kroger Co.
to sell some of its home goods products, and also a disclosure that it is two years ahead of schedule on its $1 billion, three-year share buyback program that will now conclude before the end of 2021. But those announcements, while stirring for anyone who wants to buy a memory-foam pillow with their dairy products, or is aroused by a lowering cost of capital, are hardly the stuff of 67% (and at one point as high as 106%) after-hours trading moves.
In fact, the entire frothy after-hours session augurs a big Wednesday for memes across the board. For the impetus behind that, one needn’t look further than social media, where chatter of a MOASS, or”Mother of All Short Squeezes” has returned and ignited the faithful Apes of Reddit into a new attack on short sellers in some of their favorite stocks.
“BBBY $1 Billion Share Repurchase Agreement!!!” blared a post on GameStop subreddit r/Superstonk. “GME and all Super Momentum Stocks are rising!!! BBBY might be the first Baby Catalyst for GME MOASS!!!”
Much like Avis stock earlier in the day, retail investors are showing increasing excitement about potentially using short squeezes in various stocks to draw short-sellers into a game of Whack-A-Meme, forcing them to cover their bets where they can and potentially leading into another squeeze, like the one earlier this year on GameStop that retail investors believe was rudely interrupted when Robinhood
was forced to restrict trading on meme stocks to avoid a margin call of its own.
The MOASS is now almost an article of faith amongst the Apes, a providential stock move that will deliver them into the middle of mainstream finance. But as much as many inside that mainstream might roll their eyes at such virtual histrionics, retail investors have proven to be resourceful and flexible in their approach to a new MOASS.
By spreading out their attacks, getting away from Robinhood and onto platforms like TD Ameritrade, Fidelity and Schwab, and deploying novel weapons like direct registration of shares to deprive shorts of liquidity on memes, retail investors are delivering on their promise of being a true guerilla element inside the structure of modern markets.
“Guerilla” may be a poor word choice for the self-professed “Apes,” who preach being “stronger together” while spreading out their focus. Maybe they can do both.
We shall see on Wednesday.