GameStop (GME) closed at $22.82 in the latest trading session, marking a -1.25% move from the prior day. The stock trailed the S&P 500, which registered a daily loss of 0.59%. Elsewhere, the Dow saw an upswing of 0.02%, while the tech-heavy Nasdaq depreciated by 1.46%.
The video game retailer's stock has dropped by 4.5% in the past month, falling short of the Consumer Discretionary sector's gain of 0.22% and the S&P 500's gain of 2.49%.
The investment community will be closely monitoring the performance of GameStop in its forthcoming earnings report. In that report, analysts expect GameStop to post earnings of $0.19 per share. This would mark year-over-year growth of 1800%. Meanwhile, the latest consensus estimate predicts the revenue to be $900 million, indicating a 12.74% increase compared to the same quarter of the previous year.
In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $0.75 per share and a revenue of $3.58 billion, indicating changes of +127.27% and -6.29%, respectively, from the former year.
Investors should also pay attention to any latest changes in analyst estimates for GameStop. Such recent modifications usually signify the changing landscape of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the business and profitability.
Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, there's been no change in the Zacks Consensus EPS estimate. GameStop currently has a Zacks Rank of #3 (Hold).
Looking at valuation, GameStop is presently trading at a Forward P/E ratio of 30.81. This indicates a premium in contrast to its industry's Forward P/E of 24.3.
The Gaming industry is part of the Consumer Discretionary sector. This industry currently has a Zacks Industry Rank of 95, which puts it in the top 39% of all 250+ industries.
The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Be sure to use Zacks.com to monitor all these stock-influencing metrics, and more, throughout the forthcoming 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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