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Citron Research closes GameStop short position

By Thomson Reuters Jun 12, 2024 | 8:35 AM

By Pranav Kashyap and Medha Singh

(Reuters) – Citron Research no longer has a short position in retail traders’ favorite GameStop, the short seller said on X.com on Wednesday, days after taking a bearish position in the company.

“It’s not because we believe in a turnaround for the company fundamentals will ever happen, but with $4 billion in the bank, they have enough runway to appease their cult like shareholders,” Citron said in the tweet.

Andrew Left, Citron Research’s founder, had said last week he was again betting against GameStop, although his position was “significantly lower” from 2021 when he was forced to close his position after retail traders banded together in online forums and drove an eye popping rally in the stock, squeezing hedge funds.

Left told Reuters he would short GameStop again if the stock reached a $45-$50 level. He said Citron closed the short position at a profit, although he did not disclose the size.

GameStop said it had raised $2.14 billion in gross proceeds from the stock sale it announced last week, after raising $933.4 million in May, as it capitalized on the meme stocks rally sparked by the return of stock influencer “Roaring Kitty” Keith Gill following a three-year hiatus.

The struggling videogame retailer said it intends to use the capital for general corporate purposes.

The company’s stock rose 4% in premarket trading on Wednesday. Since Gill’s livestream on Friday, the stock has declined 34% in value but it has still gained 70% from mid-May when the key figure that sparked the Reddit frenzy resurfaced on X.com.

(Reporting by Medha Singh and Pranav Kashayap in Bengaluru; Editing by Krishna Chandra Eluri)