Investor Michael Burry has just shared a previously unseen 2019 email from Keith Gill, A.K.A “Roaring Kitty,” offering a rare glimpse at the early convictions that preceded GameStop Corp.'s (NYSE:GME) dramatic surge during the 2021 “meme” stock rally.
Burry’s Letter To GameStop’s Board
On Wednesday, in a post on X, Burry said, “Remember GME? Bet you did not know this,” while sharing the letter he had sent to GameStop’s board in August 2019.
In the letter, Burry urges the management to complete the remaining $237.6 million of its buyback authorization immediately, arguing that “completing the authorization would retire over 80% of GameStop's outstanding shares,” a move that he said would dramatically increase the company’s earnings per share.
See Also: GameStop (GME) Stock Is Trying To Bounce Off 52-Week Lows: What’s Going On?
Burry cited what he called “striking” numbers, noting that GameStop had “in excess of $480 million of cash, more than enough to complete the share repurchase authorization and still invest in the business and pay down debt,” while the company’s market capitalization stood at $290 million.
Gill’s Response
The post also features Gill’s email expressing support for Burry’s analysis. “As a deep value investor, I share your views wholeheartedly,” he said, while calling out the board’s inaction despite the “absurdly low share price.”
Gill, who introduces himself as a CFA charterholder, described GameStop's chart as “one of the ugliest” that he had ever seen, while adding that he had not seen “anything like this before.”
The email shows Gill backing Burry's thesis at a time when both saw the stock as deeply undervalued despite severe pessimism from the market.
All of this happened nearly two years before the explosive short-squeeze that sent the video game retailer’s shares surging 1,294% in less than a month in 2021.
The stock is currently down 2,133% since its all-time high of $483 per share on January 28, 2021. It is down 29.45% year-to-date.
GameStop’s shares were up 2.71% on Wednesday, closing at $21.63, and are up 0.51% after hours. The stock scores high on Growth in Benzinga’s Edge Stock Rankings, but has an unfavorable price trend in the short, medium and long terms. Click here for deeper insights into the stock, its peers and competitors.
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