Preview: What to Expect From GameStop’s Q2 Earnings on Wednesday

The world’s largest multichannel video game retailer GameStop is expected to report its fiscal second-quarter loss of -$0.67 per share, an improvement from a loss of -$1.40 per share seen in the same period a year ago.

The Grapevine, Texas-based company would post year-over-year revenue growth of about 20% year-on-year to around $1.1 billion. EPS estimates have been exceeded twice in the last four quarters.

GameStop Corp. will report second-quarter fiscal 2021 earnings results after the market closes on Wednesday, September 8, 2021. GameStop shares have surged over 975% so far this year. The stock closed 5.04% lower at $202.75 on Friday.

The U.S. financial markets will be closed for Labor Day on Monday, September 6.

Analyst Comments

“Caught in meme-frenzy, GameStop has soared and outperformed the industry year to date. The company has been undertaking efforts to fast-track growth, mainly in the digital arena. To accelerate transformation, the company has resorted to board as well as capital restructuring. In this context, the company concluded selling 5 million shares in its last at-the-market equity offering program, and generated net proceeds worth as much as $1.13 billion,” noted analysts at ZACKS Research.

“Moreover, during first-quarter fiscal 2021, the company undertook steps to eliminate long term debt. Speaking of performance, the company witnessed significant improvement in the topline. It gained from sales growth across hardware, accessories and collectibles categories. Management highlighted that second-quarter sales trend continue to reflect growth, with total sales in May rising 27% year over year.”

GameStop Stock Price Forecast

Six analysts who offered stock ratings for GameStop in the last three months forecast the average price in 12 months of $88.33 with a high forecast of $190.00 and a low forecast of $25.00.

The average price target represents a -56.43% change from the last price of $202.75. From those six analysts, one rated “Buy”, two rated “Hold” while three rated “Sell”, according to Tipranks.

GameStop shares were rated “sell” by Credit Suisse Group in April. GameStop shares were raised by Wedbush to $50.00 in June from $39.00, and the firm assigned it an “underperform” rating.

GameStop’s shares were rated a “sell” by Ascendiant Capital Markets it released its July research note. Lastly, in June, Zacks Investment Research lowered its rating for GameStop from a “buy” to a “hold” and set a price target of $231.00.

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