[ad_1]
The commercial frenzy of actions at GameStop and now AMC Entertainment seems familiar to Tilray CEO Brendan Kennedy.
In 2018, shortly after its IPO, the Canadian pot producer’s stock was trapped under short pressure and rose about 1,400% between July and September of the same year on an intraday basis.
“I’ve had a little bit of PTSD over the past two days,” Kennedy said Wednesday on CNBC’s “Squawk on the Street”. “I remember getting five different calls from the Nasdaq in one day about stopping our actions because the short sellers were in such a rush.”
While the CEOs of GameStop and AMC now find themselves in a similar but strange position to what he experienced just a few years ago, Kennedy offered a caveat.
“My advice to these CEOs would be that at times like this, your business is not your action and your action is not your business,” he said. “Keep all of this in perspective as these very unusual market dynamics unfold.”
In July 2018, Tilray shares hit an intraday low of around $ 20 before starting to soar. The stock hit an intraday high of $ 300 per share in September of that year.
“I think the short sellers lost something like $ 600 million that day, September 19, 2018, which is actually a pittance compared to what I’ve read on GameStop,” Kennedy added.
Tilray hit its all-time high of just under $ 150 in October 2018, but those massive market gains didn’t last. The company’s shares traded around $ 19 in Wednesday’s session – but they had fallen into single-digit numbers when the market fell due to coronaviruses last year.
GameStop shares shot up again on Wednesday, up more than 100%, even as some high-profile short sellers reported they had pulled out of their positions. The video game retailer’s action is highly publicized by investors in online forums on sites like Reddit, taking it from around $ 6 just four months ago to around $ 330 on Wednesday. That’s a gain of about 5,400%.
The GameStop rally has put pressure on short sellers, who sell borrowed stocks in hopes of buying them back lower in the future. They return the number of shares borrowed and pocket the price difference.
AMC shares rose 235% on Wednesday to more than $ 16 each. In November, the stock was trading at less than $ 3 a share as the movie industry continued to be criticized by the coronavirus pandemic.
The company revealed in an SEC statement Monday that it had raised $ 917 million in new equity and debt capital since December, which is sufficient funding for the company to continue operating until in 2021.
[ad_2]
Source link