A video game retailer and popular "meme stock" is surging thanks to a new shareholder proposal.
What Happened: GameStop Corp (NYSE:GME) announced in a 8K filing it will have shareholders votes on increasing the number of authorized shares.
Shareholders will vote to authorize the outstanding shares authorized from 300 million shares to 1 billion.
The increase will allow the company to “implement a stock split of the company’s Class A common stock in the form of a stock dividend.”
The increased share count could be done to “provide flexibility for future corporate needs,” the filing said.
GameStop also said it will ask shareholders to approve a new incentive plan to “support future compensatory equity issuances” that would replace the 2019 Incentive Plan now in place.
A date has not been set for the company’s annual meeting. The 2021 event took place on June 9 and the 2020 event took place on June 12.
Related Link: GameStop Q4 Highlights: Earnings Plunge Year-Over-Year, Revenue Beats Street Estimate, NFT Marketplace Update
Why It’s Important: A potential stock split would follow a similar shareholder proposal put forth by Tesla Inc (NASDAQ:TSLA) to its shareholders.
Amazon.com Inc (NASDAQ:AMZN) and Alphabet Inc (NASDAQ:GOOG)(NASDAQ:GOOGL) also announced 20-to-1 stock splits earlier this year that have yet to take place.
Price Action: Investors are reacting positively to the news from GameStop and also taking other meme stocks higher in after-hours trading Thursday, according to Benzinga Pro. Many of the stocks have moved in sympathy to GameStop in the past.
- GameStop shares are up 17% to $195.
- Hycroft Mining Holding Corp (NASDAQ:HYMC) shares are up 7% to $2.46.
- AMC Entertainment Holdings (NYSE:AMC) shares are up 5% to $25.79.
- Koss Corp (NASDAQ:KOSS) shares are up 4% to $9.50.
- Express Inc (NYSE:EXPR) shares are up 1% to $3.60.
- Bed, Bath & Beyond (NASDAQ:BBBY) shares are up 3% to $23.19.
