In a recent disclosure to the U.S. Securities and Exchange Commission, Keith Gill, also known as “Roaring Kitty,” revealed a substantial new investment move. Gill has acquired a significant 6.6% stake in Chewy Inc. (CHWY). Chewy is a prominent pet products retailer listed on the New York Stock Exchange. This disclosure caused a notable 22% surge in Chewy’s shares during premarket trading.
Roaring Kitty Accumulates CHWY Stock
The SEC filing reveals that Roaring Kitty has acquired a whopping 9.01 million CHWY shares. Furthermore, this acquisition, worth $245.18 million, places Roaring Kitty as one of the largest shareholders in the company This development follows closely after Gill posted a mysterious image of a dog on his social media profile, which hinted at his future investment strategy.
The impact of his actions was starkly felt in the market, with Chewy’s stock reaching its highest levels in nearly a year during intraday trading at the time. In addition, the CHWY stock soared 21.92% to $33.21 in the pre-market trading session on Monday, July 1.
However, while Chewy’s shares soared, there was a contrasting effect on GameStop (GME). The GME stock faced a 5% decline in pre-market trading on Monday. Despite his recent success with Chewy, Gill is concurrently facing legal challenges related to his previous activities with GameStop.
A class-action lawsuit, filed on June 28, accuses Gill of engaging in securities fraud through his social media posts. Moreover, the lawsuit alleges a “pump and dump” scheme around GameStop stock. Plaintiffs claim that his posts misled followers, resulting in financial losses for many investors.
Also Read: Promising Cathie Wood Stocks To Watch Out For
GME Stock Plummets Amid Ongoing Lawsuit
Former prosecutor Eric Rosen has commented on the lawsuit, expressing skepticism about its potential success. He believes that proving the allegations against Gill may be challenging, despite the significant fluctuations in GameStop stock price attributed to Gill’s online activity between May and June.
The lawsuit claims that Gill was involved in securities fraud by supposedly not disclosing his transactions involving GameStop options calls effectively. This purportedly deceived his supporters and led to financial losses for certain investors.
Plaintiff Martin Radev, represented by the Pomerantz law firm, asserted that he suffered losses due to the alleged scheme of artificially inflating and then quickly selling off stocks. He had bought 25 GameStop shares and three call options starting from the middle of May, which dropped in value significantly.
The GME stock has continued plummeting since. At press time, GameStop stock price plunged 6.89% to $22.99 in Monday’s pre-market session. Earlier, last week, the GME stock closed at $24.69, marking a 1.59% drop on Friday, June 28.
Also Read: Japan’s Metaplanet Buys Bitcoin Worth 200M Yen, Share Price Jumps 60% MoM
✓ Share:
The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
