Just visited my local mall Game Stop with a Christmas gift card, ouch! Place is dead. And their sale swill be artifically inflated for last quarter due to these gift cards.
This company is a dying entity. They can't complete with Amazon let alone all the other online game outlet competition and the looming Apple / Google type competitors sure to lock in most of the market.
Game Stop is only a distributer, with ever shrinking retail sales looming, more store closures coming, and no end in sight. When they start bleeding cash, that is 'when' not 'if' this thing will plummet like a stone.
My visit to the local Game Stop in Santa Cruz Capitola mall was depressing. I expect it to be one more closed store over the next year.
People buy their games digitally these days and/or get their DVD copies online shopping. That trend will only accelerate. Even with their nice cash pile, Game Stop will not be able to gain enough traction in the digital world to achieve enough market share long term against all the competition, to make up for the coming fall in retail. They will have to overpay for any aquisitions and that still won't be enough to get them a big enough piece of the online pie.
Go ahead and short. I think you'll be overrun by those getting out of their short positions! March and April are historically VERY GOOD months for GME. IMO, there will be a run up to 26 pretty soon, maybe as early as mid-March. We'll see.
I havn't shorted yet, but I will watch it closely for the right opportunity, because I think 2 years from now, this company will go the way of other obsoleted outlets like 'Circuit City' as their online presence goes the way of 'myspace'.
Incorrect, the millions of people who buy games simply to look at the "collectors edition" boxes and to impress the ladies will keep gamestop going for decades to come. Plus HIGH GROWTH digital is guaranteed to work in an overcrowded market. It's a sure thing.