Michael Burry is widely known for being the investor who saw the housing market of 2008 coming, which led to The Big Short, a movie that explained the whole sequence of events. But even Burry did not see what happened to retailer GameStop (GME) coming, and lost out accordingly. As Burry explained the motivations that led him to sell ahead of GameStop’s massive run up, GameStop investors today bought in, if only slightly. GameStop shares gained fractionally in Tuesday afternoon’s trading.
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Burry started investing in GameStop back in 2018, reports noted, as the stock looked “undervalued.” And there were several potential catalysts involved that could give it a lot of extra life, so Burry piled in. When movement failed to materialize, Burry bailed, but came back in July 2019 after short interest accumulated. Burry bought in when shares were priced around $0.83 per share on a split-adjusted basis, and lent the shares out frequently.
But Burry left again in November 2020, at a respectable $3.38 per share on average. But given that the stock would eventually clear the $120 per share mark, if only briefly, it was clear Burry had left far too soon. Burry noted that, even if he had held on, he would have sold off long before the $120 mark hit. Burry noted that he was “…blinded by what I saw as execution risk”, concerned that GameStop had advantages, but could not use them effectively.
GameStop Leaks
Meanwhile, the GameStop listing for Resident Evil Requiem may have just spilled the tea on a new playable character. Sadly, those hoping to play Leon S. Kennedy again will be disappointed, as he is not involved. Rather, Rosemary Winters is likely to play a hand in Requiem, as the game apparently includes “…a unique cosmetic look for Rose’s visor” and three “…exclusive outfits for Rosemary Winters.”
Naturally, Capcom (CCOEF) has not weighed in one way or another. But GameStop may have just inadvertently ripped the Band-aid off this little surprise thanks to its own copy.
Is GameStop a Buy, Sell or Hold?
Turning to Wall Street, no analysts currently hold a position on GME stock. After a 29.33% loss in its share price over the past year, a look at the last five days of trading in GME stock shows substantial volatility. Shares are actually in a slight decline over the last two days, however, after seeing a recovery earlier in the period. Still, shares are down 4.57% for the five-day period.
