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'Roaring Kitty' Is Back Online, This Time With An Intriguing Picture

AInvestFriday, Dec 6, 2024 4:29 am ET
3min read

On Thursday, Keith Gill, the retail investor known as the Roaring Kitty, suddenly posted a tweet after nearly three months of silence, causing a stir among the online community.

Is the Meme Stocks Leader Making a Comeback?

In 2021, Keith Gill, also known as Roaring Kitty, led a group of retail investors to dramatically boost the stock price of GameStop, sparking a series of short squeezes and earning him the reputation as the leader of US retail investors.

In Thursday's tweet, Roaring Kitty shared a photo of a Time magazine cover featuring a blank computer screen displaying a video player interface, with the video duration showing 4 minutes and 20 seconds, and the playtime at 1 minute and 9 seconds.

Given that this was Roaring Kitty's first post since September, it garnered significant attention. Despite the absence of any textual explanation from Roaring Kitty himself, netizens speculated on the meaning of the mysterious image, with various interpretations.

In recent months, Keith Gill has been posting tweets every few days or months, often sparking wild conjecture among retail investors and driving up the prices of related meme stocks, like Gamestop.

Mysterious Image Sparks Numerous Guesses

In the comments section of the tweet, some netizens speculated that the 1 minute and 9 seconds could be interpreted as 69 seconds, and 4 minutes and 20 seconds as the number 420.

They believe that the numbers 69 and 420 might hint at Roaring Kitty's target prices for two of the hottest meme stocks—AMC to reach $69 (closing at $5.2 as of Thursday), and GME to reach $420 (closing at $28.63 as of Thursday).

Considering that GME itself was the most popular original meme stock during the meme stock craze in January 2021 and also the stock that Roaring Kitty was most bullish on, GME's stock price reacted the most noticeably on Thursday: it surged by more than 14% at one point during the session, but then fell back and closed up 5.92%.

Some netizens also speculated that 420 could be a reference to marijuana, as 420 is often used as a code for marijuana consumption in Western culture, and April 20th is considered Weed Day in many Western countries. Therefore, some commenters mentioned that the tweet might be related to the US marijuana ETF—MSOS.

Additionally, some people noticed that the original image was the cover of Time magazine's Person of the Year issue from December 25, 2006. In 2006, Time magazine selected You—the general public—as the Person of the Year.

They believe that the key message of the image is to celebrate the democratization of information, emphasizing that the general public is the driver of the digital age, and Thursday happened to be the historic day when Bitcoin reached $100,000. Therefore, Roaring Kitty might be expressing that You are the drivers of Bitcoin.

Some people also seized on the keyword You mentioned above, suggesting that Roaring Kitty was hinting at a US stock with a related ticker symbol. As a result, on Thursday, Unity Software (stock code U.US) saw a surge of 8.2% at one point; Clear Secure (stock code YOU.US), an airport security system operator, quickly recovered, with the daily loss narrowing from nearly 4.6% earlier to 1.15%.

Animal Spirits Reviving?

In the options market, traders scrambled to buy Unity call options, with trading volume rising to the highest since September 24; at the same time, according to data from options analytics firm Trade Alert, by 2 p.m. on Thursday, about 300,000 GME options contracts had changed hands, with trading volume about 1.5 times the usual.

Data shows that GME's 30-day implied volatility (the degree of short-term price movement expected by traders) jumped from 93% the previous trading day to a three-week high of 132%.

Riley Wealth Management market strategist Art Hogan said, The re-emergence of the popularity of meme stocks tends to follow any general resurgence in market enthusiasm and animal spirits. Whenever markets are at or near all-time highs, that particular part of the speculative side of stocks tends to pop up again.

Notably, GameStop is scheduled to release its financial results for the third quarter on Tuesday, December 10, after the market closes. According to Benzinga Pro data, analysts anticipate the company will report an earnings loss of $0.03 per share for the quarter, contrasting with the break-even performance ($0.00 EPS) from the same period last year. Historically, GameStop has surpassed analyst EPS estimates in three out of the last five quarters.

The expected third-quarter revenue for GameStop is $887.7 million, which is a decrease from the $1.08 billion reported in the third quarter of the previous year. The company has fallen short of analyst revenue projections in four of the last five quarters.

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