(Reuters) - GameStop shares surged more than 70% premarket on Monday after "Roaring Kitty" Keith Gill, the stocks influencer behind the 2021 retail trading frenzy, returned to Reddit with a post showing a $116 million bet on the embattled videogame retailer.
The stock briefly doubled in value to $46.90, with roughly $1.1 billion worth of shares changing hands by 8:15 a.m. ET (1215 GMT), second only to the $1.6 billion in Wall Street favourite Nvidia according to LSEG data.
It was the first post in three years from Gill's Reddit account, where screenshots of his bullish GameStop trades triggered a rush of demand in 2021 for "meme stocks" - often companies with weak fundamentals that gained a cult-like following through social media hype.
Sunday's post also revealed $65.7 million worth of call options expiring on June 21 at a strike price of $20.
The stock wrapped up a volatile month at $23 on Friday, about 33% higher since Gill began sharing cryptic posts and memes from his "Roaring Kitty" account on X.com in May, sparking speculation over whether he would resume sharing his trades online after the hiatus.
"Keith Gill is putting his money where his tweets are, and some investors are following his lead and rekindling interest in meme stocks," said Ben Laidler, global markets strategist at digital brokerage eToro.
"This is having a disproportionate share price impact given the short position in the stock combined with its relatively small market capitalisation."
Monday's surge also put GameStop short sellers on track to rack up nearly $1 billion in paper losses, according to data and analytics firm Ortex Technologies.
Reuters could not verify the screenshot and Gill did not respond to a request for comment on Reddit or email.
Reddit shares jumped 5.6%, while retail trader-focused brokerage Robinhood gained 3.3%.
GameStop raised $933 million by selling shares to cash in on a meme stock rally last month.
The $7 billion company has been grappling with slowing sales as its core business of selling new and pre-owned videogame disks takes a hit from consumers moving to downloading games digitally or streaming.
It is expected to post first-quarter results on June 11.
The company warned in May its first-quarter net sales would drop to between $872 million and $892 million, from $1.24 billion a year ago.