Shares of GameStop surge 22% after hours on stock split plans

The video game retailer and meme stock favorite files plans for a shareholder vote on a split. Does it change anything for investors?

Shares of GameStop (GME) are surging again, this time on news that the company wants to implement a stock split.
GameStop stock closed Thursday at $166.58 and popped as much as 22% to a high of $203.98 in extended trading. At the time of this writing, shares were trading at around $192.

What happened?

GameStop shares surged in extended trading Thursday after the company said it planned to implement a stock split.
In a filing with the Securities and Exchange Commission (SEC), the video game retailer-turned tech company said it will seek approval at its next shareholder meeting for an increase in the number of Class A common stock from 300 million to 1 billion to partly conduct a stock split in the form of a stock dividend.
The authorization would also be used to “provide flexibility for future corporate needs,” the company said. This could be referring to a potential future share offering.
The stock dividend will be contingent on final board approval, GameStop said.
GameStop has yet to specify the split ratio of the stock split.

Now what?

GameStop stock has been on a tear over the past two weeks, soaring 144% after hitting a low of $77.58 on March 14. As we noted Wednesday, meme stocks are very much alive.
For more information and a five-year look at the stock’s performance, see our guide to buying GameStop stock.

GameStop Chairman Ryan Cohen recently snatched up an additional 100,000 shares in the meme stock, according to a filing released last week. This seemingly reinvigorated shareholders, who have been piling back into the stock ever since.
All said, Cohen’s purchase and a stock split doesn’t change anything fundamentally about the stock. It still appears to be moving primarily on sentiment, which means you should expect more volatility to come — especially if it becomes more affordable for retail investors.
At the time of publication, Matt Miczulski did not own shares of any equity mentioned in this story.

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