NYSE:GME
$18.93
(2/9 3:24PM)
-3.9%
| Open | $18.98 |
Mkt Cap | $3.2 Billion |
| High | $19.4 |
52Wk High | $32.82 |
| Low | $18.27 |
52Wk Low | $19.42 |
| Volume | 9.4 Million |
Avg Vol 10D | 4.7 Million |
Ockham's Rating/Recommendation Summary
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GME Revenue
Cash earnings is the most important factor in our analysis, but it goes without saying that if a company cannot produce sales then there is no ability to generate cash flow. By that logic we look very closely at revenue numbers as our second most important factor in valuing a company's stock. We have established reasonable Price to Sales per share ranges based on historical data of the last 10 years. For, GME the high and low end of the Price to Sales per share ratios are 0.99x and 0.43x respectively.
Notice that GME's current Price to Sales per share ratio is 0.37x, which is quite a bit below what we consider a normal Price to Sales ratio for this stock. Given normal conditions and a price of $20.15, GME is 49% below where we would expect to see it. This will beneficially factor into our final analysis of GME as it is not often that this stock sinks to these levels.
GME Cash Earnings
Looking at GME specifically in their Cash Earnings capabilities, Ockham views GME as significantly below its historical average multiple of Cash Earnings. Looking at the last 10 years we can get a good understanding of what investors have grown to expect from GME. For example, GME's Cash Earnings ratio per share has fluctuated between 7.77 and 17.49 over this historical timeframe. This range is based upon a proprietary weighted methodology at Ockham, but can clearly show an investor where GME is with respect to prior business periods.
So with GME's current price (latest close of $20.15) and most recent level of Cash Earnings reported, we see significant opportunity from a value perspective. At its current price level, GME is 53% below its average level of Price to Cash Earnings on a historical basis. This means that investors were willing to pay for a much higher stock price than currently for the same level of Cash in the past, on a relative basis. There are a couple of important things to remember, however. First, value doesn't exist in a vacuum. So if the market doesn't recognize this value, even a great disparity in Price to Cash Earnings cannot force an immediate stock price reaction. Second, patience is key when looking at securities that have reached these levels of Price to Cash Earnings versus their historical norms. So be patient with GME.
GME Dividends
A strong dividend payment history is looked upon as a favorable characteristic on a company’s future and potentially can receive a positive Ockham rating. That being said, we don't require dividend payments for company's whose management has elected to forgo them entirely. As far as our investing methodology goes, it is not necessary to pay a dividend in order to get a favorable rating, so as for right now GME gets a neutral rating for the dividend portion of the model. As you can see, we are not receiving historical dividend information from our data provider on GME at this time.
Holding GME Stock? See What Is Being Discussed on The Razor's Edge
Gamestop Corporation Class A is one of the thousands of companies that Ockham has news analytics on, and it was recently discussed on The Razor's Edge.
Crowd sentiment is neutral from the millions of opinions submitted through Motley Fool CAPS, which suggests most investors on their platform believe Gamestop Corporation Class A will perform just about the same as the index. As we analyze the results from RazorWire, one thing we do is rank each stock in terms of amount of news coverage. Recently, GME has been less covered in the news compared to the rest of our universe of stocks. We consider GME as Undervalued at the current price of $18.85. According to our methodology, this stock has appreciation potential based on current fundamentals which only improves if earnings or revenue surprise.
“… In addition to the disappointing outlook from one of the industry’s top game producers, the top video game retailer GAMESTOP (GME) is down nearly 5% after it suffered a downgrade ... …”
News on Earnings Per Share for GME on The Razor's Edge
The Razor's Edge discussed earnings per share, which is one of the metrics we look at most closely. At Ockham, anytime earnings are discussed we must pay attention.
At present, Ockham has a valuation stance of Undervalued on GME, as we could see significant price appreciation based on current fundamentals like cash earnings and revenue. When taking into account the amount of news coverage each stock normally sees as a percentage of the total, Gamestop Corporation Class A has actually sunk a bit in comparison to the others. Our sentiment indicator, provided through the Motley Fool CAPS survey, suggests that investors are neutral overall towards GME and think that it will generally perform in-line with the S&P 500.
“… There are concerns that GAMESTOP’s model may be in trouble with the possibility of digital downloads grabbing an every larger slice of market share, which makes many fear that ... …”
News on GME From the Pundits on Tech Trader Daily-Barron's
As always, the latest news on GME is available to Ockham clients through RazorWire, and it was mentioned recently on Tech Trader Daily-Barron's.
Crowd sentiment is neutral from the millions of opinions submitted through Motley Fool CAPS, which suggests most investors on their platform believe Gamestop Corporation Class A will perform just about the same as the index. We consider GME as Undervalued at the current price of $18.77. According to our methodology, this stock has appreciation potential based on current fundamentals which only improves if earnings or revenue surprise. As we analyze the results from RazorWire, one thing we do is rank each stock in terms of amount of news coverage. Recently, GME has been less covered in the news compared to the rest of our universe of stocks.
“… This isn’t just an EA problem; consumer spending on video gaming is still lackluster, judging by the disappointing Q4 sales at GAMESTOP (GME), the industry’s leading retailer, ... …”
Undervalued or Overvalued? Tech Trader Daily-Barron's Takes on GME's Valuation
Gamestop Corporation Class A was talked about in relation to their valuation on Tech Trader Daily-Barron's, and you can see what the pundits are saying with RazorWire.
Crowd sentiment is favorable on this stock, as measured by the Motley Fool CAPS survey. At present, Ockham has a valuation stance of Undervalued on GME, as we could see significant price appreciation based on current fundamentals like cash earnings and revenue. When taking into account the amount of news coverage each stock normally sees as a percentage of the total, Gamestop Corporation Class A has actually sunk a bit in comparison to the others.
“… GAMESTOP (GME) shares are losing ground this morning after Credit Suisse analyst Gary Balter cut his rating to Neutral from Outperform, slicing his target price on the video game ... …”
Fast Money Discusses Higher Prices and Gamestop Corporation Class A
When a stock reaches a notable high point, investors have to ask themselves: take profits or let it run? See what Fast Money recommends for Gamestop Corporation Class A and obviously Ockham has an opinion as well.
Our sentiment indicator, provided through the Motley Fool CAPS survey, suggests that investors are neutral overall towards GME and think that it will generally perform in-line with the S&P 500. At present, Ockham has a valuation stance of Undervalued on GME, as we could see significant price appreciation based on current fundamentals like cash earnings and revenue. When taking into account the amount of news coverage each stock normally sees as a percentage of the total, Gamestop Corporation Class A has actually sunk a bit in comparison to the others.
“… Shouldn't be a surprise if you saw GAMESTOP. 52-week low and 52-week high. It's sort of interesting. > > GAMESTOP, they warned -- even though they hired a whole bunch of new ... …”
See More News on GME from The Call
The latest news from The Call on GME is available through Ockham's news analytics platform RazorWire.
Based on our methodology, Gamestop Corporation Class A should hold some appeal to value investors as we view it as Undervalued. We noticed recently that in comparison to all other stocks we analyze in the news; GME has received less coverage from the financial media in business television and blogs. The Motley Fool CAPS crowd believes this stock will perform generally in line with the benchmark, or in other words the crowd is neutral.
“… we had GAMESTOP yesterday especially blow up. They underperformed with video games so best buy looked like they gained share from GAMESTOP and that's the first time i've seen ... …”
Gamestop Corporation Class A Was Talked About by Countdown to the Closing Bell
As always, the latest news on GME is available to Ockham clients through RazorWire, and it was mentioned recently on Countdown to the Closing Bell.
A significant sell off of $3.57 is underway right now, so investors in GME should pay close attention to the news. Based on our methodology, Gamestop Corporation Class A should hold some appeal to value investors as we view it as Undervalued as of our latest report. Since that time the stock has fallen 6.7% and unless the fundamentals look much less attractive, we will likely have a bullish stance into next week. Crowd sentiment is leaning to the bearish side, according to the robust data set collected by the Motley Fool CAPS survey. We noticed recently that in comparison to all other stocks we analyze in the news; GME has received less coverage from the financial media in business television and blogs.
“… GAMESTOP, the video game retailer, not so great. Looking at it at 20. 50. Yesterday it was hovering around as far as the discounters, some of them did quite quell including ... …”
RazorWire: Both GME and 52-week Lows Discussed on Countdown to the Closing Bell
Is the worst behind Gamestop Corporation Class A or just beginning? It recently hit an abnormally low price as mentioned on Countdown to the Closing Bell.
A significant sell off of $3.57 is underway right now, so investors in GME should pay close attention to the news. Crowd sentiment is leaning to the bearish side, according to the robust data set collected by the Motley Fool CAPS survey. Based on our methodology, Gamestop Corporation Class A should hold some appeal to value investors as we view it as Undervalued as of our latest report. Since that time the stock has fallen 6.8% and unless the fundamentals look much less attractive, we will likely have a bullish stance into next week. We noticed recently that in comparison to all other stocks we analyze in the news; GME has received less coverage from the financial media in business television and blogs.
“… GAMESTOP, it's the big loser the stock was down almost 18% earlier in the day, down just shy of 15% now. It hit a 52-week low. …”
Notice a Discussion Covering GME Appeared Recently in the Financial News
The latest news from business television and influential blogs is always available through Ockham's RazorWire, and this news is in relation to Gamestop Corporation Class A.
When taking into account the amount of news coverage each stock normally sees as a percentage of the total, Gamestop Corporation Class A has actually sunk a bit in comparison to the others. Investors are headed for the exit following today's news as the stock is trading down $3.47. At present, Ockham has a valuation stance of Undervalued on GME, as we could see significant price appreciation based on current fundamentals like cash earnings and revenue. However, the GME has fallen in price since the report, and barring a change in fundamentals could be upgraded on our next report. Crowd sentiment is favorable on this stock, as measured by the Motley Fool CAPS survey.
“… And then look at GAMESTOP. This one's actually falling right now, the stock is falling, you'll have to take my word for it. …”
News on GME From the Pundits on Street Signs
As always, the latest news on GME is available to Ockham clients through RazorWire, and it was mentioned recently on Street Signs.
Based on our methodology, Gamestop Corporation Class A should hold some appeal to value investors as we view it as Undervalued. We noticed recently that in comparison to all other stocks we analyze in the news; GME has received less coverage from the financial media in business television and blogs. Crowd sentiment is leaning to the bearish side, according to the robust data set collected by the Motley Fool CAPS survey.
“… See some things -- GAMESTOP has 682 retail locations. Price of sales is . 4 and they've grown their soar s sales year over year by 11%. They're a little high at 8. 7. …”