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Ryan Cohen made a brief appearance at the GameStop (NYSE:GME) shareholder meeting today. Though he wasn’t there for long, he made quite an impression. Cohen has gained notoriety for his role in the rise of GameStop and Bed Bath & Beyond (OTCMKTS:BBBYQ). Today the investor known as the “meme stock king” didn’t speak for long on the earnings call. But he spent enough time on it to fire direct shots at GameStop’s management, specifically those who opted against buying shares of their own company. While updates regarding Cohen tend to create positive buzz around GME stock, that has not been the case today.
As GameStop’s new executive chairman, Cohen has made it clear that he intends to turn the troubled company around. But how likely is that to happen as the meme stock prepares to enter a new chapter? Let’s dive into the story further.
What’s Happening With GME Stock
Despite a week of fairly solid growth, GME stock is sliding today, even after the shareholder meeting. As of this writing, it is down more than 3% for the day, and its current trajectory doesn’t hint at a rebound. While the stock remains in the green for the month, it has been highly volatile, with several dips and surges. The addition of Cohen in a powerful leadership role has led investors to raise an important question: Can the meme stock king save the original meme stock?
As of now, it doesn’t appear that he can. InvestorPlace recently reported that it seems unlikely that Cohen can usher in a turnaround. His appointment did not spark the typical meme stock rally that often ensues when a catalyst pushes GME stock up. Now his appearance at the GameStop shareholder meeting has also failed to generate any positive momentum. That may be because the noted investor made clear how he feels about the company’s management. In his words:
“There’s a big difference between risk-free compensation for showing up, and putting a meaningful amount of your own money at risk. As a result, money is wasted, work is delegated, and a lot of time is spent managing to short-term expectations and pandering to Wall Street. I like people who roll up their sleeves and do real work. People guided by principles, not robots who seek to ‘rest and vest.’”
This isn’t surprising, as Cohen’s appointment coincided with the ousting of former GameStop CEO Matt Furlong. The new executive chairman has long been the top institutional investor in GME stock and recently purchased even more shares. However, as InvestorPlace assistant news writer Eddie Pan notes, GameStop insiders who hold shares seem committed to holding them. They haven’t sold a single share on the open market in 2023. On top of that, multiple company directors have recently made sizable investments in GameStop. Clearly, Cohen’s comments don’t apply to all its leaders.
Why It Matters
It’s easy for retail investors to get caught up in superficial hype whenever GameStop has an update. However, it is important not to lose sight of the bigger picture regarding GME stock. Cohen hasn’t been able to help it yet, and that isn’t likely to change. This isn’t necessarily a comment on him. Rather, it should reflect the company’s shaky fundamentals.
As InvestorPlace contributor Thomas Niel notes, GME stock has been largely unprofitable for most investors since the GameStop squeeze of 2021. As he sees it, the meme stock frenzy is over, which means GME stock is one to sell, no matter what Cohen does.
On the date of publication, Samuel O’Brient did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.comPublishing Guidelines.