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Roaring Kitty Pounces on Chewy
Keith Gill, aka Roaring Kitty, makes a significant investment in Chewy, sending the stock soaring
Chris Dinello
July 01, 2024
Good Morning!
There is quite a bit going on this morning in the markets, so let's jump right in!
Markets 📈
Stocks closed on Friday nearly unchanged. It seems that we still haven’t seen a major directional move as the market decides which direction to take.
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Futures are edging higher in early trading. S&P 500 contracts are up by 0.2%.
What to Watch Today:
S&P US manufacturing PMI data drops today at 9:45AM. This report surveys over 800 manufacturing purchase managers and could give us a clue as to how strong the economy is currently. Other data that comes out today is Construction spending for May and ISM manufacturing for June. Both of these reports come out at 10am EST.
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Premarket Highlights 🔎
Chewy Shares Surge After "Roaring Kitty" Takes a Stake
Chewy's stock surged in premarket trading on Monday following a Securities and Exchange Commission (SEC) filing that revealed meme stock trader "Roaring Kitty" has taken a significant stake in the pet food e-commerce giant.
The filing disclosed that Roaring Kitty, whose real name is Keith Gill, acquired over 9 million shares, equating to a 6.6% stake in Chewy. This investment makes him the third-largest shareholder in the company, with the stake valued at more than $245 million based on Friday's closing price.
Stock Rally
Before the market opened, Chewy's stock had jumped more than 20%. This spike follows a recent social media post by Gill on platform X, featuring a cartoon dog resembling Chewy’s logo, which sent the stock on a volatile ride last week, peaking at a 34% increase before settling down slightly.
Interesting SEC Filing Detail
In a quirky twist, the SEC filing included a question, “Check the appropriate box to designate whether you are a cat,” with Gill's response marked as “I am not a cat.” This humorous nod references his statement during the 2021 congressional hearings on GameStop trading.
Gill's Influence on the Market
Keith Gill is renowned for his role in the 2021 GameStop trading frenzy. Recently, he disclosed holding 9.001 million shares of GameStop, though it’s uncertain if he sold part of his GameStop holdings to finance the Chewy purchase. Following this news, GameStop shares fell by 6.5% in premarket trading on Monday.
Chewy and GameStop Connection
The link between GameStop and Chewy is significant. GameStop CEO Ryan Cohen, who founded Chewy and led its sale to PetSmart in 2017 and its subsequent IPO in 2019, joined GameStop's board in January 2021. His leadership has been pivotal in GameStop’s transformation, emphasizing e-commerce and spearheading a broader turnaround strategy.
Gill's Background
Keith Gill, a former marketer at Massachusetts Mutual Life Insurance, gained fame by rallying retail investors to buy GameStop shares and options in 2021, challenging short-selling hedge funds and becoming a key figure in the retail trading community.
Featured Earnings 💰️
Elite Pharmaceuticals [ELTP] ... PM
Cineverse [CNVS] ... PM
Economy 🏗
S&P final U.S. manufacturing PMI [Jun] ... 9:45a
Construction spending [May] ... 10:00a
ISM manufacturing [Jun] ... 10:00a
Running Hot 🔥
Gainers
Complete Solaria Inc [CSLR] >> +86.6%
Loop Media Inc [LPTV] >> +61.3%
Senti Biosciences Inc (SNTI) >> +34.71%
Decliners
Delta Apparel Inc (DLA) >> (34.1%)
Chicken Soup for the Soul Ent. [CSSE] >> (21.5%)
Actelis Networks Inc [ASNS] >> (18.6%)
Chewy Inc [CHWY] - Last Close: $27.24
The online pet retailer is surging in premarket trading.
As mentioned above, Keith Gil of GameStop fame has disclosed a 6.6% stake in the company.
Citron research thinks the 200m investment into CHWY by Gil isn’t actually his own cash.
CHWY is up 10% premarket.
My Take: CHWY is off to the races as we enter the meme stocks 2.0 phase. I would not expect this one to have much more upside at current.
Faraday Future Intelligent Electric Inc (FFIE) - Last Close: $0.506
Shares of the electric vehicle company are unchanged in premarket despite being one of the most active stocks with over six million shares traded thus far.
FFIE received approval to continue listing on the NASDAQ despite its sub dollar share price.
last month FIFE rallied to almost two dollars and volatility could return to this penny stock now that they will be sticking around on the NASDAQ for the foreseeable future.
My Take: This is a big deal for Faraday as getting booted off of a major exchange can be the final nail in the coffin of small cap companies.
Carisma Therapeutics [CARM] - Last Close: $1.28
Late Thursday, Carisma announced a new collaboration with Moderna [MRNA] on a solid tumor investigative study.
The tiny biotech said the first development candidate under the new partnership will be an in vivo CAR-M targeting Glypican-3 designed to treat solid tumors, including hepatocellular carcinoma.
The nomination triggered a $2 billion milestone payment to Carisma.
CARM is up 35.1% on over 5 million shares traded.
My Take: CARM looks like a winner on this one. A $2 billion payment and a partnership with MRNA, not too shabby for a stock with a $53 million market cap.
Tesla Inc (TSLA) - Last Close: $198.00
Another EV stock that is making moves today is Tesla Inc.
The company breached the $200 threshold and is currently up nearly 2% in premarket trading.
The stock is up because Wedbush analysts said the EV maker’s growth in China appears to be gradually improving.
My Take: TSLA looks to be luring investors back in after a tough start to the year. There are lots of catalysts to look forward to with this stock and it could continue pushing higher.
That's it for today! Thanks for reading, and good luck out there!
Best Regards,
— Adam Garcia
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