GameStop (GME) closed the latest trading day at $27.89, indicating a -1.97% change from the previous session's end. The stock's performance was behind the S&P 500's daily gain of 0.09%. Elsewhere, the Dow gained 0.32%, while the tech-heavy Nasdaq added 0.02%.
The video game retailer's shares have seen an increase of 6.24% over the last month, not keeping up with the Consumer Discretionary sector's gain of 19.62% and the S&P 500's gain of 13.05%.
Analysts and investors alike will be keeping a close eye on the performance of GameStop in its upcoming earnings disclosure. It is anticipated that the company will report an EPS of $0.08, marking a 166.67% rise compared to the same quarter of the previous year. Meanwhile, the latest consensus estimate predicts the revenue to be $750 million, indicating a 14.95% decrease compared to the same quarter of the previous year.
For the full year, the Zacks Consensus Estimates are projecting earnings of $0.47 per share and revenue of $3.4 billion, which would represent changes of +42.42% and -11.06%, respectively, from the prior year.
It's also important for investors to be aware of any recent modifications to analyst estimates for GameStop. These latest adjustments often mirror the shifting dynamics of short-term business patterns. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the company's business health and profitability.
Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the past month, there's been no change in the Zacks Consensus EPS estimate. GameStop currently has a Zacks Rank of #1 (Strong Buy).
In terms of valuation, GameStop is currently trading at a Forward P/E ratio of 60.53. This valuation marks a premium compared to its industry's average Forward P/E of 20.69.
The Gaming industry is part of the Consumer Discretionary sector. With its current Zacks Industry Rank of 143, this industry ranks in the bottom 43% of all industries, numbering over 250.
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.
Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in 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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