Opinions
Kash Pashootan
GameStop Corp.
GME-N
COMMENT
Dec 06, 2017
Stock price when the opinion was issued
You might be interested:
Keep in mind GME is a stock we have deliberately chosen not to follow too closely, as it would use up pretty much all of our time with the craziness it exudes. The financing puts it into decent financial shape, with about $1.8B net cash now. But, cash flow was negative $204M in the last 12 months. The issue comes with dilution, and even with a 6-fold increase in EPS expected from 2025 to 2026 (January year end) that still only amounts now to 6c per share, at best. So the P/E, as they say, is way up there. It still has a 21% short interest. IF GME makes an acquisition we might be more interested in it. But as it is, its revenue is about 40% lower than it was in 2018, even with higher inflationary forces. It is very hard to succeed, long term, with such declining revenue. It certainly is not a stock we would be comfortable owning, unless for pure amusement purposes ala a lottery ticket. The financing will give it flexibility, but this in itself does not guarantee a 'turn'.
Unlock Premium - Try 5i Free
You shouldn't connect this to the health of the market. There's a big chance that a lot of people will lose money in GME, which concerns him, because the regulators will get involved. The economy needs healthy markets and GME is unhealthy. There's something funny going on here and we need to get to the bottom of it.
Premium contentGameStop Corp., a specialty retailer, provides games and entertainment products through its e-commerce properties and various stores in the United States, Canada, Australia, and Europe. The company sells new and pre-owned gaming platforms; accessories, such as controllers, gaming headsets, virtual reality products, and memory cards; new and pre-owned gaming software; and in-game digital currency, digital downloadable content, and full-game downloads. It also sells collectibles comprising licensed merchandise primarily related to the gaming, television, and movie industries, as well as pop culture themes. As of January 29, 2022, the company operated 4,573 stores and ecommerce sites under the GameStop, EB Games, and Micromania brands; and 50 pop culture themed stores that sell collectibles, apparel, gadgets, electronics, toys, and other retail products under the Zing Pop Culture brand, as well as offers Game Informer, a print and digital video game publication featuring reviews of new releases, previews of the big titles on the horizon, and coverage of the latest developments in the gaming industry. The company was formerly known as GSC Holdings Corp. GameStop Corp. was founded in 1996 and is headquartered in Grapevine, Texas. Social media mentions are up 138% in the past 24h.
Premium contentGameStop Corporation is a well-known American video game, consumer electronics, and gaming merchandise retailer. The company operates various retail stores, primarily in the United States, Canada, Australia, and Europe. It has made significant efforts to transform its business model to adapt to the digital age, including forays into e-commerce and digital game services. Social media mentions are up 20.9% in the past 24h.
The world’s largest video game retailer. They’ve done a lot of things well. To combat online gaming, they have a great trade program. If someone is tired of a game, they can take the video to this company, and get credit for the new hot game they want, and that ability is not available online. The challenge is that they are going through a transition of being known as a video game retailer to being a sort of entertainment media outlet, and are doing that in a variety of ways, including getting into selling mobile phones. Expects this will trade at a discount because the market is worried about what it will look like 5 years from now. The balance sheet looks pretty good and pays a juicy dividend of 8%.