Meme stock’s favorite GameStop said it was the subject of SEC investigations. Financial market news
GameStop is one of the few stocks promoted by Reddit traders who invest based on the social media boom.
GameStop Corp. is one of the popular “memetic” companies whose stock prices have soared this year. The company said that US securities regulators are investigating the trading of its shares.
The video game retailer said on Wednesday that staff from the US Securities and Exchange Commission contacted the company on May 26 to request voluntary documents and information related to the stock.
The company stated in a quarterly document: “We are reviewing the request and producing the required documents, and intend to cooperate fully with SEC staff on this matter.” “This investigation is not expected to adversely affect us.”
People familiar with the matter said at the time that since February, securities regulators have been combing through social media and message board posts, looking for signs of fraud that have led to dizzying stock volatility in GameStop, AMC Entertainment Holdings Inc. and other companies.
GameStop is one of the few stocks promoted by Reddit traders who invest based on the social media boom. The stock price of the loss-making chain has risen 1,500% this year, closing at $302.56 on Wednesday.
After the company announced the possibility of issuing new shares and hiring two senior Amazon executives as senior leadership positions and first-quarter results, the company’s stock price fell 13% in after-hours trading.