GME - GameStop Corp.

GME [NYSE]
GameStop Corp.
Consumer Cyclical | Specialty Retail | USA​

GameStop Corp. operates as a multichannel video game, consumer electronics, and collectibles retailer in the United States, Canada, Australia, and Europe. The company sells new and pre-owned video game platforms; accessories, including controllers, gaming headsets, virtual reality products, and memory cards; new and pre-owned video game software; and in-game digital currency, digital downloadable content, and full-game downloads, as well as network points cards, and prepaid digital and prepaid subscription cards. It also sells collectibles comprising licensed merchandise primarily related to the video game, television, and movie industries, as well as pop culture themes. The company operates its stores and e-commerce sites under the GameStop, EB Games, and Micromania brands; and collectibles stores under the Zing Pop Culture and ThinkGeek brand, as well as offers Game Informer, a print and digital video game publication featuring reviews of new title releases, game tips, and news regarding the video game industry. As of February 1, 2020, the company operated 5,509 stores across 14 countries. The company was formerly known as GSC Holdings Corp. GameStop Corp. was founded in 1996 and is headquartered in Grapevine, Texas.

 

Alright, so perhaps I have been living under a rock for the past few weeks now...admittedly I have not been paying all that much attention to the market due to other more important IRL issues that I have been going through of late. But if anyone wouldn't mind sharing in here, what exactly all of this hysteria is all about surrounding this name lately, especially for the past last few days in particular? It has admittedly been a long while since I have seen this kind of mania in the market, for a company that was basically dead money for years. Anyone mind chiming in here to better help me understand what all the "hype" is all about here? Many thank you's in advance!

 

Maybe GameStop (GME) Should Stop Reporting Earnings Altogether
Thu, Sep 9, 2021

If there were a high scorer list in terms of stock performance since the start of 2020, the letters "GME" would be near the top. One hundred dollars worth of GameStop (GME) at the start of 2020 would currently be worth $2,925!



Today, though, shares of GME have been trading down over 7% following a disappointing earnings report after the close yesterday. Given the performance of GME since the start of 2020, you would think that a day like today where the stock trades sharply lower in reaction to earnings would be an outlier. Hardly. Following its six prior earnings reports since the start of 2020 leading up to today, GME has traded lower on its earnings reaction day five times for an average decline of over 16%. The only positive reaction the stock has had in reaction to earnings during this period was a 2.2% gain in June 2020. In fact, going all the way back to September 2018, that June 2020 gain was the only positive earnings reaction day for the stock. How bad have earnings reports been for GME's stock since the start of 2020? While $100 in GME stock since the start of 2020 is worth nearly $3,000 today, if you only had exposure to the stock on the day of each of its earnings reaction days since the start of 2020, that $100 would be worth less than $30 today!



The cumulative effect of GME's weak reaction to earnings also shows up if you look at its cumulative performance since 2020 not including the trading days following its quarterly earnings reports. Not including those seven trading days, $100 worth of GME at the start of 2020 would be worth nearly $10,000 today! Following its earnings conference call after the close yesterday, GME management was criticized for not taking any questions in its conference call and providing little insight into its strategy moving forward. Based on how the stock has historically reacted to earnings, though, management probably wishes they could just do away with the whole earnings process entirely.