GameStop Corp. (NYSE : GME)
GameStop Corp. (GME), a video game retailer on Thursday reported their earnings for fiscal 2015 and provided guidance for 2016. Gamestop projected first quarter earnings of $0.58 to $0.63 which fell short of analyst expectations of $0.71 per share. Gamestop projected revenues to drop between 4% and 7% which fell short of analyst expectations of a gain of 1.3%.
GameStop Corp. CEO’s Comments
Paul Raines, chief executive officer, stated, “In 2015, the GameStop team achieved several significant milestones in our on-going transformation efforts. The company posted its third straight year of positive comps, exceeded $1 billion in digital receipts, gained market share in our core video game business, and introduced new collectibles products that contributed over $300 million in sales. The company also more than doubled the number of Technology Brand stores we operate, growing sales to $534 million. These accomplishments drove record gross profit and net income, strong earnings per share growth and an increase in per store profits in our GameStop branded stores for the third straight year. For 2016, we are focused on continuing to expand store profit contribution and our diversification efforts, as we build upon our leadership in video gaming.” Market Wired
GME Technical Analysis
GME opened trading yesterday at $30.34 and closed trading at $30.27. After closing GME dropped down to $28.15, equivalent to a 7% decrease from the closing price. Taking a look at the daily chart we can see the last time GME traded below this price level was on February 16th when it traded at $28. Taking a closer look at the daily chart we can see that GME has been on an overall decline dating back to November 6th when it traded at $46.82. More recently GME has been rebounding off of its 52 week low price of $24.33 reached on January 20th. GME has a float of 102.49 million shares and traded almost 2 times the normal daily trading volume on Thursday. For trading purposes, I would be looking to take a short position Monday morning at the bell if it opens below $28.50. My stop loss would be $0.25 from my entry position, fearing anything more than that and the stock would look to fill in the gap down.
GameStop Corp. operates as a multichannel video game retailer. It sells new and pre-owned video game hardware; physical and digital video game software; pre-owned and value video game products; video game accessories, such as controllers, gaming headsets, memory cards, and other add-ons for use with video game hardware and software; and digital products, including downloadable content, network points cards, prepaid digital and online timecards, and digitally downloadable software. The company also sells mobile and consumer electronics, including new smart phones, tablets, headphones, and accessories, as well as pre-owned smart phones, tablets, and MP3 players; personal computer (PC) entertainment software in various genres, including sports, action, strategy, adventure/role playing, and simulation; and strategy guides, magazines, and gaming-related toys. In addition, it operates electronic commerce Websites comprising gamestop.com, ebgames.com.au, ebgames.co.nz, gamestop.ca, gamestop.it, gamestop.es, gamestop.ie, gamestop.de, gamestop.co.uk, and micromania.fr. Further, the company operates kongregate.com, a browser-based game site; Game Informer magazine, a print and digital video game publication; iOS and Android mobile applications; Simply Mac, a certified Apple consumer electronic products reseller; and Spring Mobile, an authorized AT&T reseller operating pre-paid wireless stores under the Cricket Wireless name that offers prepaid services, devices, and accessories. As of January 31, 2015, it operated approximately 6,690 stores primarily under the GameStop, EB Games, and Micromania names in the United States, Australia, Canada, and Europe. The company, formerly known as GSC Holdings Corp., was founded in 1994 and is headquartered in Grapevine, Texas. Yahoo Finance