The GameStop Corp. (GME) shares are trading at lower $4.11 and the avg recommendation for the stock is Hold. while the current analyst price target stands at $4.12.
To add more color to this target, the company’s high over the last year is $6.92 and the low is $2.57. Over the last 52 weeks, GME is down -40.61% while the S&P 500 is down -1.19%. The catalyst for this interesting swing was the company’s recent earnings report.
A Notable Earnings Report
In the last quarter, GME reported a profit of $282.4 million. GameStop Corp. also saw revenues increase to $1.02 billion. In addition, GME has free cash flow of -$55.9 million as of 04-2020. The company’s EBITDA came in at -$86.5 million which compares well with its peers.
GME booked profit margins of -10.80%, its Return on Equity (ROE) is -104.10%, and its Return on Assets is -22.50%. All told, it is clear that, GME needs to be on your watchlist.
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Of course, we must look beyond the financials and question how well those numbers represent the sustainable earnings power of the business. Investors need to know how sustainable this current run. GME has a short ratio of 16.20 and outstanding shares of 64.50M.
GME has seen increased volume after this news and investors are putting their support behind the value proposition. Furthermore, 10-day volume stands at 2.7 million and more growth is possible in the weeks ahead. Traders will also note the company’s earnings per share came in at -7.33. GameStop Corp. GME also noted assets of $2.47 billion at the end of the last quarter. Investors should also keep an eye on sector updates as GME has historically followed its peers on positive news.
All told, GameStop Corp. GME has strung together solid data and demonstrated underlying fundamentals. At its current valuation, GME represents an interesting risk/reward case. Traders should stay tuned to see if this recent report will push the stock to test recent resistance levels.
GameStop Corp. GME is now commanding a market cap of 280.22M and a float of 54.67M. GME is increasing its credibility in this sector and that could lead to more upside down the line. Sign-up for continuing coverage on shares of GME stock, as well as other hot stock picks, get our free newsletter today and get our next breakout pick!
Disclosure: we hold no position in GME, either long or short, and we have not been compensated for this article.