Gamestop Corp Stock Fair Value Calculation – GameStop Corp Rated Near Bottom of Specialty Retail Industry by Inves – Should it be in Your Portfolio?
June 2, 2023
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GAMESTOP ($NYSE:GME): GameStop Corp is a video game and consumer electronics retailer, operating physical stores around the world as well as an online presence. Despite their size and influence in the gaming industry, Inves recently rated the stock near the bottom of the Specialty Retail industry at 24. This rating has caused some investors to question whether GameStop Corp should be part of their portfolio on Friday. Before making any decisions about investing in GameStop Corp, it is important to look at the factors that resulted in this low rating. Firstly, sales have been declining year-on-year for the last few quarters – a worrying sign for any company. Finally, rising competition from digital distributors has been eating into GameStop’s market share. Despite these challenges, there remain reasons to be optimistic about GameStop Corp. The company is actively implementing several initiatives to improve its performance, such as investing in its online presence and expanding into second-hand markets.
Additionally, the large physical store network gives GameStop a major advantage over digital competitors. Finally, GameStop has a strong track record of dividend payouts to shareholders, which makes it an attractive option for long-term investors who are looking for income. Considering all these factors, the decision on whether to include GameStop Corp in your portfolio on Friday depends on your individual risk profile and investment goals. For those who are willing to take a long-term view and accept some risk, this could be a good stock to include as part of a diversified portfolio. On the other hand, those who are risk-averse or who prioritize short-term gains may want to look elsewhere.
Market Price
On Tuesday, GAMESTOP CORP stock opened at $23.4 and closed at $24.6, indicating a rise of 5.7% from last closing price of 23.2. This is an encouraging sign for investors, and can be seen as a positive in the otherwise poor performance of the company in the specialty retail industry. While the near-bottom rating is certainly cause for concern, it is important to note that GAMESTOP CORP still has potential for growth and could be a good long term investment. Investors should use caution when considering GAMESTOP CORP as an investment; however, there are some positives that could make it a worthwhile option.
For example, the company recently announced plans to launch a new line of gaming hardware and accessories, as well as expanding into digital media and e-commerce. This could potentially provide a much needed boost to the company’s profitability and return on investment. As such, investors should research the company further before deciding whether to invest in its stock. Live Quote…
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Gamestop Corp. More…
| Total Revenues | Net Income | Net Margin |
| 5.93k | -313.1 | -5.3% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Gamestop Corp. More…
| Operations | Investing | Financing |
| 108.2 | -222.7 | -7.9 |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Gamestop Corp. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 3.11k | 1.79k | 4.09 |
Key Ratios Snapshot
Some of the financial key ratios for Gamestop Corp are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| -2.9% | -21.7% | -5.2% |
| FCF Margin | ROE | ROA |
| 0.9% | -15.5% | -6.2% |
Analysis – Gamestop Corp Stock Fair Value Calculation
At GoodWhale, we have done an in-depth analysis of the health of GAMESTOP CORP. Our proprietary Valuation Line has determined that the fair value of the GAMESTOP CORP share is around $26.1. Currently, the stock is trading at $24.6, which is a fair price that is undervalued by 5.8%. We would advise investors to consider buying GAMESTOP CORP stock for their portfolios as it appears to be an attractive opportunity. More…
Peers
The company offers a variety of gaming devices and games for purchase or rent from its retail locations and online store. GameStop Corp competes with Amazon.com Inc, ContextLogic Inc, and RH in the retail sale of video games and gaming devices.
– Amazon.com Inc ($NASDAQ:AMZN)
Amazon.com, Inc. is an American multinational technology company based in Seattle, Washington, that focuses on e-commerce, cloud computing, digital streaming, and artificial intelligence. It is one of the Big Four companies in the U.S. information technology industry, along with Google, Apple, and Microsoft. Amazon is known for its disruptive innovation and commitment to customer service.
Its market cap is 1.05T as of 2022 and its ROE is 6.29%. Amazon has been one of the most successful companies in terms of market cap and ROE. It is a technology company that focuses on e-commerce, cloud computing, digital streaming, and artificial intelligence. Amazon is known for its disruptive innovation and commitment to customer service.
– ContextLogic Inc ($NASDAQ:WISH)
Logic Inc is a publicly traded company with a market capitalization of $483.87 million as of 2022. The company has a return on equity of -24.36%. Logic Inc is engaged in the business of providing software and services to businesses and government organizations. The company’s products and services include enterprise resource planning, customer relationship management, business intelligence, and analytics.
– RH ($NYSE:RH)
Reebok International Ltd. is a footwear and apparel company that operates in the global market. The company designs, manufactures, and markets sportswear, footwear, and equipment under the Reebok, CCM, and Rockport brands. As of 2022, Reebok had a market capitalization of 6.06 billion dollars and a return on equity of 35.86%. The company’s products are sold in more than 170 countries and territories through a network of company-owned stores, independent retailers, and distributors.
Summary
GameStop Corp. (GME) is a specialty retail stock that has performed well in the market over the past year. Fundamental analysis of the company shows strong financials, with a 24 rating from Invesco, which puts it near the bottom of the Specialty Retail industry.
Investors should consider GME in their portfolio as it is a relatively safe stock that may provide some upside potential. For those willing to take on more risk, GME is also currently trading at a discount, allowing them to potentially benefit from any potential upside in the near future.
