GameStop Corp’s stock soared more than 40% on Monday after the world’s largest video game store named Chewy co-founder Ryan Cohen to lead a new committee tasked with assisting the company’s transformation to an e-commerce market.
Since joining the board shortly before a social media frenzy drove a meteoric increase in the company’s shares, Cohen, who is a big GameStop shareholder, has been pressing GameStop to step away from the conventional brick-and-mortar model.
The recent rebound follows a series of insane price fluctuations in the company’s stock since January. Since then, GameStop has become one of the most popular and well-known “meme stocks” on social networking platforms such as Reddit’s popular WallStreetBets platform.
After a tsunami of buying prompted big short-sellers betting against the company’s shares to unwind their bets, the stock soared more than 1,600 percent in January, before paring much of those losses the following month.
Analysts speculated about whether Cohen’s mysterious tweet of an ice cream cone last week was the catalyst for GameStop’s latest rally.
In January, Cohen’s advocacy firm, RC Ventures, signed an agreement with GameStop, granting Cohen seats on the board of directors.
On Monday, shares of AMC, Koss Corp, and Rocket Companies, a mortgage company, were up between 10% and 25%. At $181.50, GameStop’s stock was up 31%.
GameStop’s Strategic Planning and Capital Committee, which will include board members Alan Attal and Kurt Wolf as well as Cohen, will help guide the company’s new e-commerce campaign, according to the company.
In the face of rising competition from videogame subscription platforms, GameStop’s brick-and-mortar store sales are under pressure. More shoppers are gravitating towards digital versions of console games.