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posted by martyb on Thursday March 25 2021, @01:29PM   Printer-friendly
from the flame-in-your-heart dept.

GameStop (the stock) and GameStop (the retailer) continue to be worlds apart:

The last time GameStop announced its quarterly earnings, in early December, the stock market valued the video game retailer at about $1 billion. Following a worse-than-expected earnings report released Tuesday night, the company now has a market cap of just under $10 billion as of Wednesday morning.

Sure, that's down roughly 18 percent from Tuesday's closing price, and off roughly 44 percent from a January peak that saw the stock offering become a poster child for the retail investor-driven "meme stock" phenomenon. Still there's not much in this week's report to suggest that GameStop as a company is worth ten times as much as it was just three months ago, much less the higher valuations it briefly enjoyed in the interim.

[...] Overall, GameStop's latest earnings report shows a company still struggling to turn itself around. For the full fiscal year, the company lost $215 million on net, improving on a net loss of just over $470 million the year prior. Net sales for the year were down over 21 percent, to $5.09 billion, a decline GameStop blamed in part on its "de-densification efforts" (i.e. closing nearly 700 stores). Even taking that move into account, though, sales for comparable stores were down 9.5 percent for the year.

Previously:
GameStop Shares Rise, Fall and Rise Again in Roller-Coaster Day of Trading
The Complete Moron's Guide to GameStop's Stock Roller Coaster
Console Options Without Disc Drives Could be GameStop's Final Death Knell
GameStop Heading Towards Possible Doom
GameStop Posts Massive Loss as Pre-Owned Game Sales Plummet


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  • (Score: 2, Insightful) by Anonymous Coward on Thursday March 25 2021, @02:37PM (4 children)

    by Anonymous Coward on Thursday March 25 2021, @02:37PM (#1128792)

    The Gamestop valuation is not based on the company's potential to make profit. It's based on the ability to make profit from the numerous short sellers of Gamestop stock. Any analysis that ignores that fact is incredibly naive, or a shill for the hedge funds.

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  • (Score: 1, Informative) by Anonymous Coward on Thursday March 25 2021, @02:50PM (1 child)

    by Anonymous Coward on Thursday March 25 2021, @02:50PM (#1128795)

    Isn't it really just making sure the massive amounts of shorts all go bust, and ultimately those bets are forced to buy the stock at high prices...driving the price up further? I think it's a pretty good example of how big of a joke the stock market is anymore.

    • (Score: 0) by Anonymous Coward on Thursday March 25 2021, @03:10PM

      by Anonymous Coward on Thursday March 25 2021, @03:10PM (#1128802)

      Why joke? You don't like the buzz around GameStop, you can ignore it and stay with assets you think have value.

      Personally, I'd rather see the market starting to question the pricing of the Internet oligarchies. What's Twitter really worth now with President Trump gone?

  • (Score: 0) by Anonymous Coward on Thursday March 25 2021, @03:06PM

    by Anonymous Coward on Thursday March 25 2021, @03:06PM (#1128800)

    It's a zero-sum hot potato game.

  • (Score: 2) by FatPhil on Thursday March 25 2021, @04:22PM

    by FatPhil (863) <pc-soylentNO@SPAMasdf.fi> on Thursday March 25 2021, @04:22PM (#1128836) Homepage
    Simpler - it's not an evaluation of the company, it's an evaluation of the stock, and the two are completely decoupled.

    Ditto Tesla. Anyone still in the ARKK ETF?
    --
    Great minds discuss ideas; average minds discuss events; small minds discuss people; the smallest discuss themselves