GameStop Q3 results: ‘I’m looking in the short-term for downside’
GameStop Corp (NYSE: GME) is trading slightly up in extended trading even though it reported its seventh consecutive quarterly loss after the bell.
What to expect from the GameStop stockCopy link to section
Versus its year-to-date high, GameStop stock is down more than 50% at writing. Unfortunately (for the meme stock fanatics), though, the possibility of another short squeeze in this name is rather slim. Speaking on TD Ameritrade Network, Joe Tigay of Equity Armor Investments said:
The short interest is there but it’s not the same we saw two and half years ago. It’s not going to be one of those catalysts that take the stock to the moon.
His dovish view is in line with Wall Street that has a consensus “underweight” rating on the GameStop that’s left with just over $1.0 billion of cash, equivalents, and marketable securities only.
If it’s going bankrupt, it’ll be less than [a dollar]. What’s the future for it? I don’t see the narrative. We’re not in a good environment for companies that are not making money. I’m just looking on the short-term for the downside.
Notable figures in GameStop’s Q3 earnings reportCopy link to section
- Lost $94.7 million versus the year-ago $105.4 million
- Per-share loss narrowed significantly from $1.39 to 31 cents
- Loss was the same even when adjusted for nonrecurring items
- Sales tanked 9.0% on a year-over-year basis to $1.186 billion
- Consensus was 28 cents of loss on $1.345 billion in sales
GameStop ended the quarter with $1.131 billion worth of inventory that was roughly the same as last year, as per the earnings press release.
In September, GameStop had partnered with FTX – the now bankrupt crypto exchange as Invezz reported here. It’s now winding down that partnership and will be offering refunds to its affected customers.
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