GameStop was buzzing on Stocktwits, even though the stock has largely remained muted in recent days.
- Last week, GameStop announced a new compensation plan for CEO Ryan Cohen that rewards him for achieving company stock and profit milestones.
- Ryan Cohen could pocket up to $35 billion at the higher end.
- Retail response to the plan is mixed, and a large section of investors remains concerned about the share weakness.
GameStop Corp. drew heavy buzz on Stocktwits early Monday, following the disclosure of CEO Ryan Cohen’s long-term compensation plan that could see him pocket $35 billion – about three times the company’s current market cap – if the video games retailer achieves periodic stock and profit milestones.
Cohen’s compensation is now structured in nine separate tranches. At the highest level, Cohen would be granted options to purchase nearly 172 million shares if the company reaches a $100 billion market capitalisation and delivers $10 billion in cumulative EBITDA (earnings before interest, tax, depreciation, and amortization).
The plan closely resembles Tesla CEO Elon Musk’s 12-year, $56-billion compensation plan from 2018, which a Delaware judge voided. Last year, Musk won the support of Tesla shareholders and the court for an even higher compensation package.
For GameStop – the struggling retailer, which closed hundreds of stores last year – the CEO compensation has generated a mixed response. The stock gained for two sessions after the announcement, and declined on the third.
On Stocktwits, it has sparked a widespread debate, with some seeing it as a strong alignment of interests and a bullish signal, while others express skepticism regarding the ambitious goals and potential for dilution. The retail sentiment shifted to ‘bullish’ as of early Sunday, from ‘bearish’ last week when the announcement was made.
“$GME stays on watch due to crowd interest + volatility potential. Volume is the key tell here — when it returns, things can move quickly in either direction,” said one user.
Members also discussed the recent weakness in the share price and the potential return of its leading influencer, Keith Gill (better known as “Roaring Kitty”), based on his brother Kevin’s social media posts, which they believe show that he’s trying to communicate with the market.
Stocktwits reported earlier that GameStop has been absent from meme-stock activity this year, with attention shifting to new names such as Opendoor Technologies, GoPro, and Kohl’s, among others.
Some investors expected GameStop – which has nearly $8 billion in assets, including nearly 5,000 bitcoins – to announce a major growth plan or pivot at its December earnings report, but were left disappointed.
GME stock is up 5.7% so far this month. It lost 36% last year.
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