GameStop (GME) stock saw a significant surge on Monday following a post on Reddit by user "DeepF***ingValue," believed to be associated with individual investor Keith Gill, also known as Roaring Kitty. The screenshot posted on Sunday night purportedly showed a position of nearly $175 million in GameStop.

According to the screenshot, the user holds 5 million GameStop shares purchased at an average price of $21.274, worth $115.7 million based on Friday's closing price. Additionally, the account appears to own 120,000 options contracts expiring on June 21, with the right to buy GameStop shares at $20 each, valued at $65.7 million.

GameStop's stock surged as much as 75% at the market open and doubled during premarket trading, reaching $38 per share before being temporarily halted for volatility.

However, Interactive Brokers chief strategist Steve Sosnick warned against chasing the rally, questioning whether the account's actions were in investors' best interest or the account owner's. He cautioned investors that chasing the stock's rise might result in providing liquidity for the account owner to sell into their enthusiasm.

This surge comes after GameStop rallied 180% over two days in mid-May following "Roaring Kitty's" first post on X (formerly Twitter) since 2021. However, analysts cautioned that the recent meme action was not comparable to the retail inflows seen in 2021.

Despite this, GameStop took advantage of May's rally by selling 45 million shares, generating approximately $930 million. Surprisingly, the stock surged 25% on the news, contrary to typical expectations of a decline in the stock price following a share sale.

Similarly, AMC (AMC) benefited from the meme frenzy, raising $250 million through the sale of 72.5 million shares last month. On Monday, AMC shares were up approximately 10%.

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