Citron

GameStop

Dogecoin

GmeStop

<a href="https://citronresearch.com/" data-wpel-link="external" target="_blank" rel="noopener noreferrer nofollow">Citron Research</a>, a prominent GameStop (GME) short seller, has exited its short position on the stock.
The firm cited “the market’s irrationality” and “cult-like” shareholder behavior in its decision, as announced in a June 12 X post:
“Citron is no longer short $GME. It’s not because we believe in a turnaround for the company fundamentals will ever happen, but with $5 billion in the bank, they have enough runway to appease their cult-like shareholders.”
This move follows a significant rise in GME’s stock price, which soared above $30 after a 22.8% intraday rally on Tuesday.
Currently, GME is trading at $30.49, up 3.3% in pre-market trading, according to Google Finance.
Michael Pachter, a GameStop analyst at Wedbush, has set an underperform rating on GME with a 12-month price target of $11, suggesting a potential 60% drop from its current price.
Despite this bearish outlook, Citron Research chose to close its short position due to prevailing market irrationality:
“Despite Wedbush setting an $11 target today, we respect the market’s irrationality.
“After all, Dogecoin remains a $20 billion entity.
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“While the increased share count might temper the mob mentality, Citron will be watching from the sidelines for now.”
Citron drew a comparison with Dogecoin, which has a $20.2 billion market capitalization driven by social media hype despite lacking intrinsic value.
This highlights the impact of market sentiment and risk appetite on valuations.
During the retail investor-fueled short squeeze, GameStop raised $2.14 billion by selling 75 million shares through an “at-the-market” equity offering on June 11.
This fundraising effort coincided with Roaring Kitty’s, also known as Keith Gill, first live stream in over three years, which further boosted GME’s price.
Citron Research criticized Gill’s live stream, calling it “an insult to capital markets.” According to a June 2 Reddit post, Gill held $181.4 million in GME stock and call options.
His screenshot showed he had purchased five million GME shares for $115.7 million and invested $65.7 million in call options, predicting GME would be at least $20 a share by June 21.
Despite the controversy and volatility, Citron Research has decided to observe from the sidelines for now.
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Citron Research Exits GameStop Short Position Amid Market Irrationality and Cult-Like Shareholder Behavior

Crypto Intelligence

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