1,300% rally in 4 days! Wall Street gets new meme stock to revive GameStop memories

Shares of US-based plant-based protein maker Beyond Meat have surged more than 1,300% in just four trading sessions, fueled by a social media frenzy reminiscent of GameStop’s rally. The rally came after a Business Insider report revealed that a trader named Demitri Semenikhin had been actively promoting the stock online, drawing comparisons to Keith Gill, better known as Roaring Kitty, who helped fuel the GameStop mania during the Covid-19 lockdowns.

The first spark came when Walmart announced plans to expand Beyond Meat’s lineup to more than 2,000 stores in the US. The company said its chicken cuts, Korean barbecue-style steak and six-packs of burgers will now be available at more outlets. The rise gained further momentum after Roundhill Investments added Beyond Meat shares to its Roundhill Meme Stock ETF, giving retail traders another reason to get in.

The dramatic spike sent short sellers into a panic; some rushed to cover their positions to avoid further losses, while others doubled down, Bloomberg reported. On Wednesday, the stock had made a sharp move, rising as much as 112% over the course of the day before finishing 1.1% lower. The sell-off continued after hours, with shares down 20% to $2.86 as of 4:27 p.m. in New York.

Once a stock market favorite after its Nasdaq debut in 2019, Beyond Meat has seen its fortunes fade in recent years. The El Segundo, California-based company has struggled with weak demand for its plant-based products, which has led to job cuts and efforts to control its debt. Net sales fell by 15% in the first six months of this year.

Last week, Beyond Meat shares fell following the expiration of lock-up restrictions on some of its 326 million new shares, part of a broader plan to reduce debt and extend repayment terms. The end of the lock-up period gave shareholders the freedom to sell, adding to the volatility that meme stock traders have now increased.

Also read: Epack Prefab Technologies shares zoom 20% to new 52-week high as second-quarter PAT rises above 100%. They are typically associated with high volatility and speculative trading. (Disclaimer: Recommendations, suggestions, views and opinions expressed by the experts are their own. These do not represent the views of The Economic Times)