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GameStop (GME) Falls More Steeply Than Broader Market: What Investors Need to Know

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GameStop (GME - Free Report) closed the latest trading day at $22.33, indicating a -0.36% change from the previous session's end. This change lagged the S&P 500's 0.28% loss on the day. Meanwhile, the Dow lost 0.61%, and the Nasdaq, a tech-heavy index, lost 0.33%.

Heading into today, shares of the video game retailer had gained 4.72% over the past month, outpacing the Consumer Discretionary sector's gain of 2.26% and the S&P 500's gain of 0.41% in that time.

Market participants will be closely following the financial results of GameStop in its upcoming release. At the same time, our most recent consensus estimate is projecting a revenue of $900 million, reflecting a 16.54% fall from the equivalent quarter last year.

Regarding the entire year, the Zacks Consensus Estimates forecast earnings of $0.01 per share and revenue of $4.03 billion, indicating changes of -83.33% and -23.57%, respectively, compared to the previous year.

Furthermore, it would be beneficial for investors to monitor any recent shifts in analyst projections for GameStop. These revisions help to show the ever-changing nature of near-term business trends. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the company's business health and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To capitalize on this, we've crafted the Zacks Rank, a unique model that incorporates these estimate changes and offers a practical rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed an unchanged state. GameStop is holding a Zacks Rank of #3 (Hold) right now.

Looking at its valuation, GameStop is holding a Forward P/E ratio of 2241. This expresses a premium compared to the average Forward P/E of 21.5 of its industry.

The Gaming industry is part of the Consumer Discretionary sector. Currently, this industry holds a Zacks Industry Rank of 156, positioning it in the bottom 39% of all 250+ industries.

The Zacks Industry Rank assesses the strength of our separate industry groups by calculating the average Zacks Rank of the individual stocks contained within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Remember to apply Zacks.com to follow these and more stock-moving metrics during the upcoming trading sessions.


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