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Bank of America (Underperform): “While shortages for the next gen consoles (and the Nintendo Switch) could be a drag on sell through in 4Q, overall demand appears to be very high. However, we remain very skeptical that this console cycle will be a material or lasting benefit to GME. On the contrary and as we highlight in our console cycle survey, we believe the next gen console accelerates digital penetration which is already over 50%. We also believe a very strong year for overall video game demand will make growth even tougher for GME next year.”
Benchmark (Sell rating): “GME delivered a dramatic downturn in F3Q20 financial performance including disappointing consensus on revenue, gross profit and EBITDA. We suspect continued pressure on in-store foot traffic from players that are concerned they could contract the virus and potentially become sick from shopping at a GME location. Comparable store sales declined 24.6% and 18.7% for F3Q20 and FYTD, respectively.
The public video game publishers we cover have all reported dramatic increases in digital adoption of content or an acceleration of existing digital trends that should prove sustained and effectively dislocate the high margin trade-in value proposition GME championed. We believe a vast majority of players have scant desire to buy product from a GME retail or ecommerce locations and the hottest games are often free-2-play like Fortnite. The growth in GME’s ecommerce sales is a function of the virus influence rather than a compelling platform, in our view, and the idea they can compete with Amazon is comical. We think GME’s desire to expand SKU offerings by selling PC gaming computers, monitors, and gaming TVs is not a transformational strategy and should constrict gross margin. We question management’s understanding of the video game market; we strongly believe that they will never become ‘the social/cultural hub for gaming’ that they desire.
Further, GME established an ATM program to offer and sell up to $100M common stock; we expect they will dilute shareholders.”
Telsey Advisory Group (Outperform):
“GameStop is rationalizing its store base, investing in digital capabilities, leveraging its loyalty program (~60MM PowerUp Rewards members), and adding newer businesses, such as PC gaming. These initiatives and trends, combined with a leaner store operating model and balance sheet, should help drive earnings growth and generate free cash flow. Partly offsetting our enthusiasm is the continued shift to digital gaming and increased competition across retail. We maintain our Outperform rating, but are lowering our 12-month price target by $1 to $18, based on applying an EV/EBITDA multiple of ~5x to our 2021 EBITDA estimate of $197MM.”
Citron Research @CitronResearch
Tomorrow am at 11:30 EST Citron will livestream the 5 reasons GameStop $GME buyers at these levels are the suckers at this poker game. Stock back to $20 fast. We understand short interest better than you and will explain. Thank you to viewers for pos feedback on last live tweet
[color=purple][size=5][b]Thanks for the shoutouts and help on this from all the crew – Friday and today wholesale panic and greed immersed together
76.62 ▲ 11.88 (18.34%)
January 25, 1:15 PM EST
64.75
Open 96.79
P/E –
Vol 129.22 M
High 159.18
Avg Vol 25.94 M
Low 61.13[/b][/size][/color]GameStop gapping Down
Pre-market $GME 168.00 −23.45 (-12.25%)
Reported sales increased 11% yr/yr in first 9 weeks of FY21;
AND filed prospectus for 3.5 mln share At-The-Market Equity Offering Program) #gamestonkGameStop today that CEO George Sherman will be stepping down on July 31, or earlier upon the appointment of a successor. A new CEO would be GME’s sixth since late 2017.
The move was not a huge surprise, given that GME had disclosed in its 10-K last month that it was evaluating executive leadership changes and had retained a search firm for that purpose. Also, CFO Jim Bell departed last month.
GME recently hired Jenna Owens as COO. She came over from Amazon (AMZN), and before that Google (GOOG). That was a clear signal that GME wants more tech-focused management.
[color=green][b]GameStop Corp
NYSE: GME 167.00
▲ 12.31 (+7.96%)[/b][/color][color=green][size=5][b]Gamestop trades higher after completes offering
180.99▲ 12.19 (7.22%) After Hours[/b][/size][/color]
GameStop day after earnings (and another offering) down ▼ 86.76 (-28.68%) $GME $215.80
If chatter is near true the same shorts buried last time did again – some say they stopped out towards $300 others say they held – whatever massive moves
LOSSES FOR MELVIN CAPITAL AND LIGHT STREET CAPITAL TOTAL ABOUT $6BN SINCE THE START OF MAY – FT
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