Interesting news is coming out of the GameStop investor space today as popular activist investor Carl Icahn is said to have allegedly been shorting GME stock since it hit its height in 2021. The 86-year-old billionaire investor has reportedly been betting against the value of GameStop and it seems to have paid off since he began building his short when GME was at an astronomical high as retail investors were short-squeezing and driving up its value.
Reports of Carl Icahn’s short position with GameStop came out of Bloomberg, reporting on anonymous sources close to the matter. Apparently, Icahn began building a short position with GME around January 2021 when it and other retail stocks exploded in a short-squeeze fueled heavily by the combined efforts of investors at r/WallStreetBets and further retail investors. This drove the stock value up to a high of around $483 per share. The stock has since lost around 70 percent of its value, meaning Icahn’s bet has, to this point, paid off. However, the size of Icahn’s investment in the short has been unclear as Icahn and GameStop have currently refused to comment on the matter.
Interestingly enough, Carl Icahn was recently seen with GameStop Chairman of the Board Ryan Cohen in a picture taken together and posted to Cohen’s Twitter in October 2022. Regardless of the relationship between the two, it seems fairly clear that Icahn doesn’t believe GME should be valued so highly and will likely continue to lose value. Even so, the stock still sits well above its abysmal state in late 2020 before the short squeeze began.
A 4-for-1 stock split has further reduced share price of $25.89 as of 10:43 a.m. PT on November 22, 2022, but being that it has held strong and well over the non-split stock price of GME in 2020, which occasionally slipped under $2 a share, GME still seems to be doing better than it was. It will remain to be seen if Icahn’s short bet continues to remain successful as Cohen and GameStop continue to use the momentum to transform and grow the company. Stay tuned for further updates as they become available.