A photo illustration of the Chewy logo is seen on a smartphone and a PC screen.
Pavlo Gonchar | SOPA images | Light rocket | Getty Images
Tough Stocks rallied dramatically on Thursday after meme stock leader Roaring Kitty on the social media platform
Roaring Kitty, whose legal name is Keith Gill, has heated up trading in speculative names like GameStop by posting cryptic images and memes online. On Thursday afternoon, an image of a cartoon dog appeared on his X-Feed, briefly sending Chewy shares up as much as 34% to $39.10.
Later, the stock fell into negative territory again in Thursday’s session and closed the day down 0.3%.
There’s also a strong connection between meme stock GameStop and Chewy. GameStop CEO Ryan Cohen was the founder and CEO of Chewy, who was instrumental in PetSmart’s acquisition of Chewy in 2017 and its subsequent IPO in 2019.
Cohen joined the GameStop board in January 2021 along with two other Chewy executives, helping in part to drive the initial GameStop rally. He later took over as CEO of GameStop in 2023 and initiated the turnaround at the brick-and-mortar video game retailer.
Shares of pet retailers like Chewy and Petco surged during the pandemic as stuck-at-home consumers adopted cats and dogs in droves. With the adoptions came the purchases of necessary accessories such as new beds and linens for their furry family members.
But as the pandemic ended and people went outside again, adoption numbers fell and consumers had less need for pet supplies like toys and cages, which bring higher profit margins than pet food.
Last year, Chewy and Petco posted strong pet food sales across the board, but sales declined in higher-margin categories.
Gill is a former marketer for Massachusetts Mutual Life Insurance. He came into the spotlight after successfully encouraging retail investors to buy GameStop shares and call options in 2021 to exclude short-selling hedge funds. The 2021 mania led to a series of congressional hearings in which Gill grilled brokers’ practices and the “gamification” of retail trading.
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2024-06-27 21:13:58
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