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GameStop shares surge after it raised $550 million in stock sales

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GameStop shares surge after it raised $550 million in stock sales

GameStop shares rose more than 6 percent in early trading Tuesday after the company announced it raised $551 million through a stock sale to speed up the company’s turnaround effort.

Shares of the company were up more than 11 percent in premarket trading after the announcement, before paring some gains once the markets opened.

The video game retailer first announced the at-the-market offering of 3.5 million shares earlier this month. It’s one step by the company to benefit from the head-turning rally that’s sent the stock soaring almost 800 percent this year.

GameStop said the cash will be used to “continue accelerating GameStop’s transformation.” The company said earlier this month that Ryan Cohen, billionaire entrepreneur and co-founder of pet food online retailer Chewy, would become chairman of GameStop later this year. Cohen, who is also manager of activist investor RC Ventures, has been building a stake in the company since last year in an effort to push the company to shutter unprofitable stores and focus on e-commerce growth.

Cohen’s involvement in the company and his attempts to shake the 37-year-old firm up helped lead to the Reddit-fueled explosion of the stock in January, when retail traders created a massive short squeeze in GameStop, sending shares up 400 percent at one point. The Grapevine, Texas-based retailer traded at less than $20 a share at the start of the year.

The capital raise comes amid a major managerial shakeup. GameStop announced last week that its CEO George Sherman will step down by July 31. It said the board is searching for possible replacements who can help with the e-commerce push. The company also announced that it hired former Amazon and Google executive Jenna Owens as its new chief operating officer.

GameStop recently brought on several executives from Amazon, Walmart, QVC and Chewy for top positions. Chief merchandising officer Chris Homeister resigned from the business last month and Chief financial officer Jim Bell announced his resignation in February, as the company searches for a successor with more of an e-commerce background.

GameStop said earlier this month in a securities filing that it was nominating Larry Cheng, the first investor in Chewy, and Yang Xu, an executive at Kraft Heinz, to its board, as well.

Despite the turnaround effort, shares of the company remain far higher than consensus estimates on Wall Street. According to data compiled by the Wall Street Journal, the average price target on GameStop among major analysts is $46.50, far below the stock’s current price of almost $180 per share.

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AMC cashes in on Reddit-trading frenzy with $428 million share sale

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AMC cashes in on Reddit-trading frenzy with $428 million share sale

Cinema operator AMC Entertainment Holdings has raised about $428 million from a share sale, capitalizing on the retail-trading driven surge in its stock earlier this year.

The world’s largest cinema chain operator’s shares have gained more than five-folds in 2021 thanks to interest from amateur traders on Reddit that were piling into heavily shorted stocks such as GameStop and AMC to punish hedge funds that bet against them.

AMC said in a statement Thursday it had sold 43 million shares at an average price of $9.94 apiece in the at-the-market offering, sending its stock nearly 16 percent higher.

The company has raised funds in the past few months to ride out a downturn in its business wrought by pandemic-driven theater closures, delays in the launch of big movies and the growth of video streaming platforms.

It said in January it had raised $917 million since mid-December through equity and debt issues. It raised an additional $304.8 million in the same month through a share sale.

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Amazon Fresh grocery store to replace Fairway in Paramus

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Amazon Fresh grocery store to replace Fairway in Paramus

The Paramus Fairway’s getting a fresh start.

An Amazon Fresh supermarket is set to replace the shuttered Fairway Market in Paramus, N.J.

The Jeff Bezos-owned e-commerce giant bought the former Fairway location out of bankruptcy auction along with another former Fairway store in Woodland Park for a total of $1.5 million last March, The Post previously reported. 

Amazon’s plans for the two locations were listed as confidential at the time, but came as the Seattle-based company, which also owns Whole Foods, was beginning to expand in the groceries space. 

But Amazon confirmed in November the former Woodland Park Fairway would be converted into an Amazon Fresh. And now, the Paramus location will go the same route, an Amazon spokesperson confirmed to NorthJersey.com. 

It’s not clear when opening day will be, and the company did not return The Post’s request for comment. 

Amazon opened its first Fresh store in Los Angeles’ Woodland Hills neighborhood in September. It’s since opened 11 other locations elsewhere in California and in Illinois, according to the tech giant’s website. 

Amazon Fresh is the company’s attempt to offer a mix of in-store and online grocery shopping while attracting a distinct demographic from Whole Foods by offering lower prices. Fresh stores also tend to feature more national staple brands like Coca-Cola and Kellogg’s than Whole Foods, which emphasizes organic food. 

As The Post previously reported, Amazon may be looking to scoop up some more Fairway locations to expand Amazon Fresh’s footprint in the Northeast. Only seven of Fairway’s 14 stores were sold at last year’s bankruptcy auction, including the two that went to Amazon. Village Supermarket, which operates Shoprite stores, acquired at least four of those locations as well as rights to the Fairway brand. 

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McDonald’s to boost wages by 10 percent amid worker shortage

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A McDonald's in Spring, Pa., advertises $15-an-hour jobs on April 19. Like other restaurants and retailers, McDonald's is facing a nationwide labor shortage as the pandemic wanes.

McDonald’s said Thursday it will boost its rank-and-file employees’ hourly pay by 10 percent as it seeks to add 10,000 workers at its company-owned eateries amid a nationwide labor shortage.

The world’s biggest restaurant company said entry-level employees will now get paid between $11 and $17 an hour while managers will make anywhere from $15 to $20 an hour. The wage boost also will apply to 35,600 existing McDonald’s employees, some of whom have already received the increase, the company said.

“Together with our franchisees, we face a challenging hiring environment, and staying ahead means we must constantly renew our commitment to offer one of the leading employment packages in the industry,” McDonald’s USA president Joe Erlinger said in a message to US workers.

McDonald’s said it expects all of its company-owned stores to be paying workers an average of $15 an hour by 2024 while some will get there as early as this year.

The wage increases come amid one of the tightest labor markets in history with a record 8.1 million job openings as of March. Critics have partly blamed generous unemployment benefits which have included a $300 weekly COVID-19 sweetener from the federal government. Workers have also cited concerns about a lack of childcare services and health and safety fears.

A worker cleans the floor at a McDonald's in Chicago on March 19. Some workers say they're reluctant to return over health and safety concerns.
A worker cleans the floor at a McDonald’s in Chicago on March 19. Some workers say they’re reluctant to return over health and safety concerns.
Scott Olson/Getty Images

Some McDonald’s franchisees have been handing out hiring and referral bonuses to attract employees. As previously reported by The Post, a McDonald’s manager in Florida even offered $50 for potential candidates to simply interview for a job — and said he had no takers after two weeks.

Chipotle Mexican Grill said this week that its average wage will reach $15 an hour by the end of June as it pushes to hire 20,000 workers.

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