GameStop shares rise after the CEO resigns, “Roaring Kitty” raises the stakes

GameStop rallied Monday after the brick-and-mortar video game distributor announced its succession plan as it tries to pivot toward e-commerce after a brief historic pressure fueled by Reddit earlier this year.

GameStop shares rose more than 8% in early trading, opening at about $ 167.

The company said that on Monday, CEO George Sherman will resign on July 31 or sooner, after the appointment of a successor. The board is conducting a search to identify CEO candidates with the skills and experience to help accelerate the next phase of the company’s transformation, GameStop said in a statement.

While GameStop shares topped a record high of $ 483 in January, shares are still up 720% for 2021. To take advantage of the massive rally, GameStop announced a $ 1 billion share sale earlier this month April to accelerate the e-commerce transition led by activist investor and board member Ryan Cohen, who is co-founder of Chewy.

The company has also hired former Amazon and Google CEO Jenna Owens as its new CEO.

Some investors have also been comforted by Keith Gill’s move on Friday to double his GameStop bet, giving up quick profits of millions of dollars on an options transaction. Gill is probably the biggest influencer in the Reddit retail crowd.

The investor, who goes on DeepF —— Value on Reddit and Roaring Kitty on YouTube, exercised his contracts for 500 GameStop call options as they expired on Friday, offering him another 50,000 shares at a price of weight of only 12 USD. If he had sold the options at Friday’s price, he could have won more than $ 7 million in the bet.

In addition to exercising these option contracts, Gill bought another 50,000 GameStop shares, bringing its total investment to over 200,000 shares worth over $ 30 million.

Gill’s trading information is in line with his Reddit posts which appear to be snapshots of his investment account. Posts were not independently verified by CNBC.