Don't Buy GameStop Stock Until This Happens
(NYSE: GME) has undergone a remarkable transformation, thanks in large part to its moment in the sun as a red-hot meme stock. While the company's share price has pulled back substantially from its lifetime high of nearly $87 per split-adjusted share reached in January 2021, the stock's explosive valuation gains paved the way for the company to undertake a dramatic financial repositioning.
In response to soaring gains for its share price driven by short squeezes and meme-stock momentum, GameStop moved to sell new shares in order to raise funds. While the stock sales had a dilutive impact for shareholders, they had a transformative impact on the retailer's balance sheet. The share offerings allowed the company to pay down its debt and build a massive cash position.
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Source Fool.com
