The GameStop Corp. (GME) stock is rising at an exceptional rate in the current-market session of Tuesday 9th March as of this writing. It has gained 22% in the current market after its share price jumped 41.21% in the normal trading session on Monday and closed at $194.5.
Why the price is going up so rapidly?
There are two major events behind the share price hike.
The first one is about the stimulus package from the new U.S government which set up a positive trend and many companies saw good growth in their stocks on Monday. The market is expecting a financial package of $1.9 trillion which may include $1,400 direct payments to the Americans.
But the main reason behind the GME stock price increase was the announcement made by the company about the appointment of Ryan Cohen to lead the GEM transformation to e-commerce.
The company made some changes to its corporate level and the GME board of directors announced the Strategic Planning and Capital Allocation Committee, to identify initiatives that can further accelerate the Company’s transformation. The newly formed committee will be chaired by Ryan Cohen and will include Alan Attal, and Kurt Wolf.
Chair of the Board’s Nominating and Corporate Governance Committee will be lead by Mr Attal and Mr Wolf will lead the Board’s Compensation Committee. The new committee is formed to focus on identifying steps and methods which can transform GameStop into a technology business. The committee has also appointed a chief technology officer.
Mr Ryan Cohen and Mr Alan Attal are both used to work at chewy.com and Kurt Wolf is the founder of Hestia Capital. Both Mr Attal and Mr Wolf are active investors.
The new appointment shows that the company is serious about its transformation to the e-commerce business and enhancing its e-commerce capabilities. Earlier, Cohen has said GameStop needs to offer a credible method for controlling costs by focusing on its most profitable retail locations while developing and enhancing its e-commerce capabilities.
The share value of Game Stop has gained more than 590% since January 12, after the company signed an agreement with Cohen’s RC Ventures LLC to restructure its board and focus on digital sales.