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GameStop shares? No thanks!INTL

GameStop shares? No thanks!

GameStop (GME) plans to sell up to $1b of its stock to capitalize on the massive gains it made earlier this year when Reddit users congregated to essentially tick-off Wall Street’s hedge fund short-sellers. The video game retailer plans to use the proceeds to fund its e-commerce overhaul.

As you may remember, GameStop’s shares jumped over 900% since January after the amateur retail investors joined forces to boost its otherwise pretty irrelevant stock. Now, the company wants to cash in those dollars — the new sale will encompass up to 3.5 million shares worth no more than $1b. Investors weren’t too happy with the news, though, as its stock dropped by nearly 14% on Monday.

why it matters
GameStop’s good fortune is likely going to be short-lived, which is why the firm needs to capitalize on it ASAP. Other companies at the forefront of similar Reddit frenzies (eg AMC and American Airlines) have also sold shares to boost their financial sheets.