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GameStop Corp. Message Board

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  • johnmr12 johnmr12 Oct 1, 2012 12:38 PM Flag

    Perfect storm is brewing

    I agree with everything you said, but I guess that's why I have about 25% of my portfolio here. I have learned that most of the time, when there is a high short interest in a stock, it's justified. In most cases, it's because of the history of the management team. I have been burned by that in the past. When I researched GME, I found nothing but positives concerning their management team, and I realized that the only reason for the huge short position was that Jim Chanos publicly said GME would be the next blockbuster video. Since he got famous from shorting Enron, MCI, and Blockbuster, the sheep followed him here. I really think Chanos expected GME to guide lower each qtr for the remainder of their existance, and that's why so many articles from Motley fool talk about lower revenue and margins. There's no way shorts thought GME would reach their guidance of $3.10-$3.30 for the year, so if they raise guidance for Qtr 4 and the fiscal year above $3.30, a whole bunch of shorts are going to have to re evaluate their strategy. On the other hand, if they lower guidance I will re evaluate my strategy. Let the games begin!

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    • Chanos is a #$%$ if he thinks games and movies are the same. He doesn't understand the segment at all. They are literally nothing alike. Gamestop as a physical presence is in NO danger until well after the NEXT generation (not next year's) when consoles MIGHT stop using physical media (10+ years). Until then, GME will be raking in the dough.

      Blockbuster was primarily a rental establishment, not a "jeez, I have to trade in my old games in so GME can resell them for more more money just because I need the money to buy the next hot game" establishment frequented by millions of teenagers. And Gamestop still has the clout to offer exclusive bonuses and other freedbies to folks who pre-order new games through them. I just pre-ordered Dishonored through them not just because I am an investor, but because they're the only ones to offer free themed Tarot cards Stuff that drives collectors crazy.

      Also, unlike movies, the video game business is extremely cyclical, and we're on the verge of another boom cycle like we saw in 2007.

      That's why I am 100% in GME. Call me CRAZY, but we'll see who laughs last.

      Sentiment: Strong Buy

    • or the go into the stores and see no one there. Nobody I know goes to Gamestop anymore, they buy their games at Target or Wal-Mart and that iPhone trade-in point is the dumbest thing I've ever seen. Let's lode up on inventory of antiquated technology. Brilliant. To put 25% of your portfolio in anything is pretty dumb, but to put it here....yikes. good luck to you. It's going to sell off after earnings, there's no doubt about that, but it might run up 2 more bucks from here if the sheep like what they see in the distance so if I was long I wouldn't sell here, but I'm not selling my puts either.

      Bottom line, this company won't be around in 10 years, the game is when will the price of the stock reflect that, It could be next year or 5 years from now.

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