GameStop CEO Ryan Cohen is now free to invest the retailer's cash in stocks, Warren Buffett-style
GameStop CEO Ryan Cohen is now free to invest the retailer's cash in stocks, Warren Buffett-style
Like Warren Buffett, Ryan Cohen can now pick stocks for GameStop to buy. Wedbush's Michael Pachter blasted the decision as "inane" and "alarming."
All of GameStop's nearly $1 billion in cash is now at Ryan Cohen's unilateral discretion.
RC can now use GameStop's money to buy stocks of other companies, which may or may not involve any mergers or acquisitions.
What is really interesting and exciting about this, to me, is that it puts "our" money into his hands. It's our money because we are GME investors, and shareholders are the owners of companies, and GameStop's money is part of the shareholder equity that belongs to shareholders.
Ryan Cohen has a vision and a strategy, and access to valuable information, and he does not telegraph his strategy to the competition. We don't know specifically what his intentions are, we don't know specifically what his strategies are.
What we do know is that our interests are in alignment.
We shareholders are in alignment with the RCEO because he is also a (major) shareholder. If RC makes a move that benefits GameStop, it benefits all GME shareholders including himself and us.
If RC takes a strategic investment opportunity, we are all going along for the ride.
This is pretty great, in my opinion, because assuming that you trust RC, it means all a person needs to do is hold GME, and they will get exposure to whatever strategic investments that RC might make. As for me, I trust that RC has a better capability than myself to wisely invest in any non-GME assets.
Also, it's pretty funny to me how some financial incumbents find this news to be "alarming". It's alarming to them, it scares them. It scares them because they already decided that GameStop is bad and Ryan Cohen is bad, but now Ryan Cohen has even more concentrated control to support his ability to execute his strategy.
I've now seen on multiple occasions, the sort of FUDdy counter narrative: now Ryan Cohen has the ability to buy assets that aren't GME. If he had any faith in his company, he would simply use that money to do a GME share buyback.
What a giveaway.
These opponents want RC to do a GME share buy back. Almost as if, this would be a strategically poor move for GameStop at this time but a good move for GameStop's opponents. Discussed here is why, as of this time, it would not be a good decision to do a share buyback. The only scenario in which that would actually be a good idea would be if the price of GME tanked very low. Better to hold on to that buyback money as an insurance policy, just in case the share price ever does get tanked. In that case, the waiting cash for the buyback covers the problem.
In the mean time, at current GME prices, there are probably other undervalued opportunities that RC has his sights on, and this is scary to anyone that opposes GameStop's success.
17Was there any indication of interest after towel company blew up ? If cellar boxing is a thing wouldn't the end of towel cause serious ramifications? Also isn't towel being part of the basket theory also something?
My biggest requirement would be everyday things. Would love to pay for my bills through GameStop. If they could do power, insurance, banking, groceries, internet or phone plans. Then I could pay for things I already pay for but also enhancing a company I buy into.
Maybe something like Nvidia GeForce now streaming service or data center would be more up GameStop. Possibilities are endless
7I'm so happy a rich guy can now get more rich! Way to go!
3Time to buy bed bath and beyond, right guys? /s
0We can't buy BBBYQ shares, but RC will buy the whole company
6Just like that one time when Burry bought Porsche because it was time to buy VW 💎🤙
4
What will you say if he makes bad investments and loses some/most of that cash? I see a lot of similarities between the WSB deification of Cohen and MAGAs deification of Orange Julius Caesar
-1Would definitely be unfortunate. At this point, anyone long GameStop has their wagon pretty clearly hitched to Cohen. Even before this investments policy change, Cohen has had the freedom to issue almost 700mil shares into the market and has not done this. Trust is required, so I assume those long GameStop are comfortable with that risk.
13I wonder if the board was as heavily invested in Orange Julius as GameStop's board is.
Ryan Cohen and Larry Cheng keep buying more shares of GameStop and Ryan Cohen is opting to not receive any payment for his role as CEO, as instead his earnings should come from improving the share value.
So I see Ryan Cohen as very much aligned with shareholders and share value, as he has put his money where his mouth is. It gives me a good amount of confidence with how he decides to invest this money.
8
Nice. Let's see what he does, if anything. Watching the board and chair work when unencumbered, and then evaluating the results helps investors to gauge trust and allocate their capital accordingly.
Show us the plan Mr. Cohen. Enough moving in silence and the dark. I'm ready for bigger plans and bigger moves toward increasingly positive profitability and returns for shareholders here.
-3I wouldn't expect him to start telegraphing his moves now. It's a big part of his ethos.
His actions speak quite plainly though. Looks like we're on track for a profitable year.
9That's fair. It does seem to be part of his ethos and I shouldn't expect a leopard to change its spots. Guess I'm just interested to see more progress.
If it's profitable this quarter, then I'm in favor of the "moving in silence" bit. If it's not profitable I'd prefer more clarity, at least on the plans. If not from him, then from the company or another representative. The crypto/web3 stuff seems to have stalled a bit waiting for more regulatory clarity. But if it's just the calm before the storm of positive moves, then so be it.
6
He can invest in VOO like an adult, and you guys might actuall see a return on investments for once in your lives. Congratulations you own part of a hedge fund. A patheticly tiny hedge fund.
-5Nobody wants another hedge fund –– we want to update the system so it works for everyone. 💜
4
I can't wait until MOASS in 2133, it's going to be so lit. I just have to hold these nearly worthless tickets until then. I'm so glad I invested a bunch of money into this and don't feel conned at all!
-6I can relate to your resentment. The stock market feels like a con, and that's because it is. I ask people, unrelated to this community, "Do you think it's rigged?" Invariably the answer is yes. What do you think can be done? Do you really think selling will help?
4