Exactly one month ago, we introduced the world to Ryan Cohen – the guy who bought 9 million shares of GameStop stock in the middle of 2020 when it was trading at $8 a share. Our original article, published on January 28, would go on to be one of the most-read articles in Celebrity Net Worth history, reaching 12 million people on Facebook alone. This was in the middle of the first wave of GameStop mania, when the price per share soared from $19 to $400+, making the little-known Ryan Cohen a multi billionaire on paper. As GameStop's stock dropped back down to reality, landing in the $40-50 range, we assumed the mania was over. We were wrong. GameStop mania is back baby! And it's all because of a photo of an ice cream cone…
A Quick Backstory
Before becoming GameStop famous, Ryan Cohen was known for being the co-founder of online pet food/toy company Chewy.com. In 2017 Chewy was acquired by PetSmart for $3.35 billion. PetSmart took Chewy public in 2019. Today Chewy has a market cap of $42 billion.
Cohen earned several hundred million dollars from the original PetSmart sale.
As we mentioned previously, at some point in the middle of 2020, Ryan acquired 9 million shares (9,001,000 to be exact) of GameStop at an average price per share of $8. He now owns roughly 10% of GameStop. In total he spent around $76 million acquiring his shares. He was given a seat on GameStop's board of directors and mostly stayed quiet for the next few months.
In November 2020 Ryan posted a public letter to GameStop's board of directors that blasted the company's performance. At the time the company's share price was around $10. Five years earlier, the share price was around $30.
[Disclaimer – I do not own any shares of GameStop and this article is not advising you to buy or sell shares in anything. It is purely informational/entertainment…]
Mania Part 1
In mid-January things started to get a little… funky.
GameStop popped to $20, then $40, then $70.
On January 26, the stock ended the day a few pennies below $148.
For a brief shining moment on Wednesday January 27, GameStop shares hit $483 per share. At that level, Ryan's 9 million shares were worth a bit below $4.4 billion.
Mania Cools Down
The mania started to cool on January 28.
January 28: GameStop ended the day at $193 per share. At that level, Ryan's stake was worth $1.7 billion.
January 29: GameStop ended the day at $325. At that level, Ryan's stake was $2.995 billion.
February 1: GameStop ended the day at $225. At that level, Ryan's stake was $2.025 billion.
February 2: GameStop closed at $90 on Tuesday. Reducing Ryan's stake to $810 million.
February 11: GameStop closed at $51 per share. At that level Ryan's 9 million GameStop shares were worth $460 million.
Mania Part 2
On Tuesday February 23, GameStop stock closed the day at $44.97 per share.
On Wednesday February 24 at 1:57 PM EST, Ryan posted a photo of a McDonald's ice cream cone and a frog emoji to Twitter. Seriously:
— Ryan Cohen (@ryancohen) February 24, 2021
I had to dig into this for a half an hour to figure out the meaning. Here's what I discovered –
In finance there's a term called "Moving Average Convergence Divergence". Also known by its abbreviation "MACD", some finance geeks view it as a "trend-following momentum indicator that signals when a stock might be overbought or undersold". Very basically, it's an indicator that it might be time to buy or sell a stock.
MACD. Like McDonald's. Hence the ice cream cone in Cohen's tweet.
What about the bullfrog? According to one twitter detective, apparently when a stock is about to cross from being oversold (aka it's time to buy), the chart colors go from purple to green, so people call it "going froggy".
Again, when Ryan sent his tweet at 1:57 PM EST GME was at $49. Two and a half hours later when markets closed, GME was at $91.
GME opened at $151 on Thursday.
GME ended the week at $101.
Here's a chart I created with some notable moments last week:
At the moment Ryan sent his ice cream cone tweet, his 9 million shares were worth =
When markets closed on Wednesday, two and a half hours later, Ryan's shares were worth =
When markets opened on Thursday, Ryan's shares were briefly worth =
At the end of trading Friday with GME closing at $101.74, Ryan's 9,001,000 shares were worth =
And that's where we started when markets opened Monday.
When markets closed on Monday, GameStop was up 18% on the day, closing at $120.40. At that price, Ryan's shares were worth =
Are we in for another couple loops in the roller coaster??? We'll keep you posted!