In the latest trading session, GameStop (GME) closed at $22.55, marking a -1.87% move from the previous day. This move lagged the S&P 500's daily loss of 0.3%. On the other hand, the Dow registered a loss of 0.46%, and the technology-centric Nasdaq decreased by 0.38%.
The video game retailer's stock has dropped by 5.78% in the past month, falling short of the Consumer Discretionary sector's loss of 1.35% and the S&P 500's gain of 3.64%.
The investment community will be paying close attention to the earnings performance of GameStop in its upcoming release. On that day, GameStop is projected to report earnings of $0.19 per share, which would represent year-over-year growth of 1800%. In the meantime, our current consensus estimate forecasts the revenue to be $900 million, indicating a 12.74% growth compared to the corresponding quarter of the prior year.
For the annual period, the Zacks Consensus Estimates anticipate earnings of $0.75 per share and a revenue of $3.58 billion, signifying shifts of +127.27% and -6.29%, respectively, from the last year.
It is also important to note the recent changes to analyst estimates for GameStop. Such recent modifications usually signify the changing landscape of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the business outlook.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To take advantage of this, we've established the Zacks Rank, an exclusive model that considers these estimated changes and delivers an operational 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 past month, there's been no change in the Zacks Consensus EPS estimate. GameStop is currently sporting a Zacks Rank of #3 (Hold).
In terms of valuation, GameStop is presently being traded at a Forward P/E ratio of 30.64. This represents a premium compared to its industry average Forward P/E of 23.23.
The Gaming industry is part of the Consumer Discretionary sector. With its current Zacks Industry Rank of 93, this industry ranks in the top 38% of all industries, numbering over 250.
The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks 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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GameStop Corp. (GME): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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