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Luke Kawa

GameStop rallies as Michael Burry takes a trip down memory lane

Shares of GameStop are up more than 3% in premarket trading on Friday.

Thanksgiving is a time for catching up with family and reminiscing about the good times. To that end, early Thursday morning (just after midnight), hedge fund manager turned Substacker Michael Burry published tweets that purportedly offer a look into the lore of his time spent betting on the success of the video game and collectibles retailer ahead of its ascendance to meme stock status.

In one, he shared screenshots of Scion Asset Management’s letter to GameStop’s board of directors, as well as emails appearing to be from Keith Gill, aka Roaring Kitty, the retail trader whose GameStop thesis inspired legions to jump onboard, and Ryan Cohen, who would go on to become GameStop’s chairman, president, and CEO.

Shares have bounced back in earnest since the stock regained support of the $20 level at the start of this week.

Burry’s Scion announced a bullish GameStop position in GameStop in 2019, and held this through at least the third quarter of 2020.

At the peak of its meme stock frenzy in January 2021, however, he called the price action “unnatural, insane, and dangerous” in a since-deleted tweet, and said that he was no longer long or short the company.

Do I think this is the reason why shares of GameStop are flying on Friday morning?

Eh, in most circumstances I’d say this is pretty thin gruel. But this is a stock that has, in the past, traded off of nostalgia, its exposure to things that are cool or entertaining, and leaders with Big Main Character Energy.

Your mileage may vary, but to me Burry’s trip down memory lane hits a few of these notes. The company is inside the top 20 most mentioned tickers on SwaggyStocks over the past 12 hours as of 8:20 a.m. ET, has seen the greatest pickup in mentions on Stocktwits compared to the prior session (per a Bloomberg Automation report), and Burry’s post is being very positively received on the r/Superstonk subreddit dedicated to discussions of GameStop.

That being said, all this is not something that can reasonably been said to have changed the outlook of GameStop’s estimated future discounted cash flows.

Of course, it’s also Black Friday, and we’ve seen promotional events be a boon for the video game and collectibles retailer this year:

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Lululemon’s stretch getting tested: Stock plunges after after outlook is cut

Lululemon shares are down double digits in premarket trading after the company cut its full-year sales and profit outlook, overshadowing a Q1 beat and raising fresh concerns about the brand’s turnaround efforts.

The company now expects fiscal 2026 revenue to be flat to down 1%, compared with its prior forecast for 2% to 4% growth. Guidance for full-year diluted earnings per share was dragged down to a range of $10.95 to $11.15, below the company’s previous guidance of $12.10 to $12.30 and well below Wall Street’s estimate of $13.26.

Key numbers for Q1:

  • EPS of $1.69 vs. the $1.68 expected.

  • Revenue of $2.47 billion vs. the $2.43 billion expected.

The modest top-line beat masked a widening divergence between Lululemon’s geographic markets. While international revenue rose 22% overall with a 30% increase in Mainland China, the bigger problem remains North America, where revenue fell 5%.

Interim co-CEO and CFO Meghan Frank acknowledged during the earnings call that recent product rollouts underperformed. A highly anticipated yoga campaign failed to generate its expected “halo effect” across broader product lines.

Profitability metrics took a major hit, with gross margins contracting by 410 basis points to 54.2% due to mounting tariff costs and promotional markdowns. Operating income consequently fell 37% year over year to $276.9 million.

“We experienced spikes of negative commentary in the media and on social channels with regard to our brand, which had an impact on traffic and overall top-line performance,” Frank said during the earnings call. “And second, not all of our product launches have met our expectations. While we have had several successful launches so far this year, we have seen others as we start Q2 not generate the anticipated guest response.”

Lululemon’s valuation has already been steadily compressing for years. While it was once one of retail’s richly valued stocks, investors have been questioning whether the company can return to the double-digit growth era.

The results also arrive during a leadership transition. Lululemon announced back in April that former Nike executive Heidi O’Neill is set to take over as CEO in September, with investors looking to her to revive growth in North America and restore the brand’s growth.

As Lululemon faces both macroeconomic pressure and brand-specific challenges, its stock has dropped around 40% year to date.

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US job growth skyrocketed in May, blasting past expectations

The US economy added 172,000 jobs in the month of May, the Bureau of Labor Statistics reported Friday, sending 10-year Treasury yields higher.

The strong May job market surprised economists. Experts had predicted only 85,000 new jobs — just half the reported number. The unemployment rate held steady at 4.3%, as expected.

The job growth story is a hopeful spot for the economy as consumers continue to feel inflationary pressure from the Iran war.

Job gains were buoyed by the leisure and hospitality sector, which added 70,000 jobs, as well as local government, healthcare, and education.

Both the March and April jobs reports were revised upward, making them collectively 93,000 higher than previously reported.

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