Sunday, October 17News That Matters

Tag: GameStop Corporation

Robinhood Reveals Rising Revenue and a $1.4 Billion Loss

Robinhood Reveals Rising Revenue and a $1.4 Billion Loss

Technology
The company’s shareholders, however, stuck with it. Within a week, it raised two rounds of emergency funding totaling $4.4 billion to meet lending requirements for stock trades and to continue making trades. That funding resulted in Robinhood’s outsize loss in the first three months of the year.Robinhood attracted scrutiny from regulators long before the GameStop frenzy drew the national spotlight. In 2018, it announced that it would offer checking and savings accounts, claiming it was already backed by the Securities Investor Protection Corporation, a consumer protection group that oversees brokerages. After the group said it did not insure checking and savings accounts, Robinhood backtracked and started the service a year later.Last year, Robinhood was fined $65 million by the Securities...
He’s a Dogecoin Millionaire. And He’s Not Selling.

He’s a Dogecoin Millionaire. And He’s Not Selling.

Technology
Last February, when Glauber Contessoto decided to invest his life savings in Dogecoin, his friends had concerns.“They were all like, you’re crazy,” he said. “It’s a joke coin. It’s a meme. It’s going to crash.”Their skepticism was warranted. After all, Dogecoin is a joke — a digital currency started in 2013 by a pair of programmers who decided to spoof the cryptocurrency craze by creating their own virtual money based on a meme about Doge, a talking Shiba Inu puppy. And investing money in obscure cryptocurrencies has, historically, been akin to tossing it onto a bonfire.But Mr. Contessoto, 33, who works at a Los Angeles hip-hop media company, is no ordinary buy-and-hold investor. He is among the many thrill-seeking amateurs who have leapt headfirst into the markets in recent months, using ...
Meme Stocks and Archegos: Fed Calls Out Financial Weak Spots

Meme Stocks and Archegos: Fed Calls Out Financial Weak Spots

Business
The Federal Reserve warned about financial stability risks emanating from frothy stocks and debt-laden hedge fund bets in its twice-annual report on potential vulnerabilities in the system, pointing to the rise of so-called meme stocks as one sign that risk-taking could be getting out of hand.The central bank’s Financial Stability Report, released Thursday, followed an unusual six months for markets. Over that period, stocks climbed steadily as the U.S. economic outlook rebounded, and stories of excess began to crop up.Internet discussion boards helped fuel interest in stocks such as GameStop, a cryptocurrency created as a joke has run up in value, and a little-known hedge fund melted down, stories that have captured headlines and caused many — including, evidently, some at the Fed — to as...
How Small Market Investors Are Being Wooed by Companies

How Small Market Investors Are Being Wooed by Companies

Business
That has prompted a strategy adjustment. In addition to spending time communicating with analysts whose “buy” or “sell” ratings on the stock can move its price, Mr. Schreiber said, he has made a point of doing interviews on podcasts, websites and YouTube programs popular with retail investors.“I think that they are, today, far more influential on, and command far more following in terms of stock buying or selling power than the mighty Goldman Sachs does,” Mr. Schreiber said. “And we’ve seen that in our own stock.”Academic research suggests that over the longer term, it can be a competitive advantage for a company to have a patient base of investors who understand and believe in its strategy. Such a steady foundation makes it possible for executives to focus on longer-term strategic goals, ...
The Bull Market Is One. Can It Last?

The Bull Market Is One. Can It Last?

Business
More questions than answersThe bull market is now a year old, with the S&P 500 up nearly 75 percent from its low point at this time last year. That recovery, The Times’s Matt Phillips writes, is “a testament to the unbridled enthusiasm that let investors shrug off the economic carnage of the pandemic and buy stocks — and pretty much anything else.” The factors that have stoked the rally also raise questions about whether it can last.Is this a bubble?Analysts are wary of using the B-word to describe the market as a whole, despite the best 12-month stretch for stocks since the 1930s. But John D. Turner, a finance professor who wrote “Boom and Bust: A Global History of Financial Bubbles,” is convinced: “If I had to put money on it, it looks like a bubble,” he told The Times. A bubble has ...
GameStop says it is considering selling additional shares.

GameStop says it is considering selling additional shares.

Business
Shares of GameStop — the struggling retailer at the heart of the trading frenzy that captured the country’s imagination in January — tumbled in after-hours trading on Tuesday as quarterly earnings missed expectations and the company said in a filing it could sell additional shares.The company’s stock was down roughly 12 percent shortly after 6 p.m. The shares had remained steady amid a brief conference call in which executives presented the company’s results and declined to take questions.But the stock began to slide after the company said in a separate filing with the Securities and Exchange Commission that it was evaluating whether to sell additional stock “primarily to fund the acceleration of our future transformation initiatives.”Such a share sale would reduce the value of the company...