GameStop Corp GME shares are trading lower Wednesday on the heels of the company’s first-quarter financial results. Here’s what you need to know.
What To Know: GameStop reported mixed results for the first quarter with revenue coming in at $732.4 million, below analyst estimates of $754.24 million, and adjusted earnings per share totaling 17 cents, above estimates of four cents.
GameStop said total revenue fell about 17% year-over-year as hardware and accessories revenue of $345.3 million was down from $505.3 million in the prior year’s quarter and software revenue declined from $239.7 million to $175.6 million. Meanwhile, Collectibles revenue increased from $136.8 million to $211.5 million year-over-year.
GameStop ended the period with approximately $6.4 billion in cash, cash equivalents and marketable securities. Subsequent to quarter’s end, the company used cash to buy 4,710 Bitcoin after GameStop’s board approved the crypto as a treasury reserve asset last quarter.
Following the company’s quarterly results, Wedbush analyst Michael Pachter reiterated GameStop with an Underperform rating and price target of $13.50.
Pachter expects to see continued declines in revenue in the company’s core business. Although he acknowledged that the Nintendo Switch 2 release could provide a “transitory bump,” he expects the trend in overall revenues to be lower.
“GME shares trade at a level that overlooks the many challenges ahead,” the Wedbush analyst said in a note to clients.
How To Buy GME Stock
Besides going to a brokerage platform to purchase a share – or fractional share – of stock, you can also gain access to shares either by buying an exchange traded fund (ETF) that holds the stock itself, or by allocating yourself to a strategy in your 401(k) that would seek to acquire shares in a mutual fund or other instrument.
For example, in GameStop’s case, it is in the Consumer Discretionary sector. An ETF will likely hold shares in many liquid and large companies that help track that sector, allowing an investor to gain exposure to the trends within that segment.
GME Price Action: GameStop shares traded down to around $28.30 following the print. The stock was bouncing back a bit Wednesday morning, last down 5.31% at $28.55, according to Benzinga Pro.
Read Next:
Photo: Shutterstock.
