Meme Stocks Are Roaring Again, A Repeat Of 2021 Frenzy

Meme stocks are shaking Wall Street once again.

AMC Entertainment, the movie theater operator, leaped 32% Tuesday. I Photo: Paul Sableman Flickr

That shouldn’t be much of a surprise. Ever since bands of smaller-pocketed and novice investors began taking stock prices of downtrodden companies to breathtaking heights three years ago, the potential for more flareups has been obvious, Stan Choe reported for the Associated Press (AP).

Some things are different this time.

The biggest change from the initial supernova for GameStop’s stock is how the experience of 2021 makes this all feel familiar. That familiarity, plus some changes in the market, should allow Wall Street to more easily digest the sharp movements, experts say.

GameStop in 2021 put securities markets’ capacity and resilience to a test that “few could have anticipated,” the staff of the US Securities and Exchange Commission (SEC) said in a report later that year.

GameStop, the granddaddy of meme stocks, has soared suddenly and sharply. It jumped 60.1% Tuesday after surging 74% the day before. Other meme stocks from the pandemic era are moving just as radically.

AMC Entertainment, the movie theater operator, leaped 32% Tuesday.

On Monday, investors pumped a net $15.8 million into GameStop, along with $37.5 million into AMC, according to data from Vanda Research. That compares with $87.5 million and $170 million, respectively, in 2021.

“Do we think more retail traders can jump in on the trend in the coming days? Yes,” according to Marco Iachini, senior vice president at Vanda Research. “Do we think this is a repeat of 2021? No, and the chances we reach that stage are low.”