March 20, 2022
Redbox Entertainment shares did a strange thing on March 18. The stock catapulted more than 50% in value at the close of the business day after climbing from $1.82 per share at the opening bell, to $3.48 in midday trading, and closing at $2.69 per share.
Through the course of the business day, more than 22 million shares traded hands — exponentially higher than the average daily volume of 984,000 shares traded. The home entertainment icon’s stock continued its upward trajectory March 21, with shares up 4.5% in mid-morning trading on more than 3.2 million shares changing hands
Such movement typically is the result of some company news or outlying market conditions impacting the stock. But there wasn’t any news. Nothing. Redbox Entertainment management hasn’t mentioned much since presenting at the 2022 Virtual ICR Conference on Jan. 11, where CEO Galen Smith again reiterated the company’s strategy of targeting DVD kiosk renters and late streaming adopters with a one-stop-shop for their home entertainment needs.
Redbox’s lone bad news has been an ongoing market shortage of new release movies from the studios due to the pandemic, among other supply issues.
Michael Pachter, senior media analyst at Wedbush Securities in Los Angeles, covers Redbox and is perplexed by Friday’s stock movement.
Could it be short sellers hoping to cash in when shares plummet? Day traders looking to turn Redbox into a meme stock where a company’s stock gain sudden popularity with individual investors on social media platforms and goes through the roof in value?
“I have no idea,” Pachter said in an email.