Back in 2018, shortly after it went public, the Canadian pot producer’s stock was ensnared in a wild short squeeze and rose about 1,400% between July and September of that yr on an intraday foundation.
“I’ve had a little bit of PTSD over the last couple of days,” Kennedy mentioned Wednesday on CNBC’s “Squawk on the Street.” “I remember getting five different calls from Nasdaq in a single day about our stock being halted because the short sellers were being squeezed so badly.”
As the CEOs of GameStop and AMC now discover themselves in a comparable but unusual place to what he skilled simply a few years in the past, Kennedy provided a cautionary perspective.
“My advice to those CEOs would be that, at times like this, your company is not your stock and your stock is not your company,” he mentioned. “Keep it all in perspective as these very unusual market dynamics are taking place.”
In July 2018, Tilray shares hit an intraday low of round $20 earlier than they started to rocket larger. The stock reached an intraday excessive of $300 per share in September of that yr.
“I think the short sellers lost something like $600 million on that particular day, Sept. 19, 2018, which actually pales in comparison to what I’ve been reading about GameStop,” Kennedy added.
Tilray notched its file shut of slightly below $150 in October 2018, however these huge stock positive factors didn’t final. The firm’s shares traded round $19 throughout Wednesday’s session — however they’d fallen into the one digits throughout final yr’s coronavirus-driven market plunge.
Shares of GameStop soared once more Wednesday, ending larger by 135%, at the same time as some high-profile short sellers indicated they’d retreated from their positions. The online game retailer’s stock is being hyped by traders in on-line boards on websites like Reddit, inflicting it to soar from roughly $6 simply 4 months in the past to its Wednesday shut of $347.51 on Wednesday. That’s a achieve of practically 5,700%.
The GameStop rally has put stress on short sellers, who promote borrowed shares in hopes of shopping for them again decrease in the longer term. They return the borrowed variety of shares and pocket the value distinction.
AMC shares rose 301% Wednesday to practically $20 apiece. In November, the stock was buying and selling below $three per share because the movie show trade continued to be slammed by the coronavirus pandemic.
The firm revealed in an SEC filling on Monday that it had raised $917 million of latest fairness and debt capital since December, which is sufficient financing to preserve the corporate working properly into 2021.