GameStop: A Stock With More Potential Than You Think

GameStop: A Stock With More Potential Than You Think

Research  these Stocks on Kapitall’s Playground Now

research now

2013 could be a great year for GameStop (GME) and its shareholders. Microsoft (MSFT) is planning to release its next generation console by year-end with Sony planning to release its new hardware before the holiday season as well. Grand Theft Auto V, a video game by Take-Two Interactive Software (TTWO), will be released in September. The GTA franchise has generated 125 million in sales to date and GTA V has the potential to be the biggest game launch of the year.

GameStop has been taking abuse lately because its industry is shrinking as consumers shift to mobile games. However, the video-game retailer is making strategic moves into tablet apps, free online games, and other digital revenue streams that are allowing them to capitalize on this shift.

[Related: Find Good Buys With Strong Returns and High Quality]

Fourth-quarter profits for GameStop beat estimates with net income rising to $261.1 from $174.7. EPS grew from $1.27 in Q4 2011 to $2.15 in Q4 2012 and EPS is estimated to be $3.17 in 2013 and $3.26 in 2014. Another highlight is the $1.10 dividend GameStop offers, a type of return to shareholders that is hard to find on the street these days.

With a quality ratio of .55 and price-to-book value of 1.54, GameStop meets the requirements for a bargain priced high quality stock, which means having a quality ratio (gross profit margin/total assets) greater than .33 and a price-to-book value less than 1.7.  Bargain price stocks that score high on quality have been show to outperform the overall market by 4% annually.

Business Solutions: Investing Ideas

Although GameStop may not look great from an industry viewpoint, over the next year the retailer should put up some strong numbers thanks to next generation hardware sales and game sales for these new consoles.

A consumer usually buys 3 to 5 games with the hardware, which will help boost GameStop’s lagging new game sales numbers. There is also the promise of the retailer adjusting to the new gaming landscape by starting to focus on new digital revenue streams.

GameStop is also at a bargain and ranks high on the quality ratio, a good sign that it has the potential to outperform the market over the next year. GameStop has a lot of potential good news coming down the pipe this year and is showing that it’s willing to adapt, so I recommend taking a closer look at this stock.

More investing ideas from Nick Sousa:

Platinum Metals: Boost From New Trading Block & Emission Standards

Disney’s Great Leadership & Content Mean a Big Winner 

Healthcare Sector: High Quality Stocks at a Great Value

Find Good Buys With Strong Returns and High Quality


33 Responses to “GameStop: A Stock With More Potential Than You Think”

  1. Not sure why GME is at 30. This company was left by most investors. Refresh of consoles, continued resales for new console games, sales of mobile devices…all justify value for this company, it seems.

  2. Gamestop is a good stock in disguise.

  3. I never thought mobile games would take such a toll on businesses like GameStop.

  4. Unsure the reason why GME is in thirty. This company was still left by means of nearly all investors. Rekindle of games consoles, ongoing resales pertaining to new system games, revenue of mobile phones… all make a case for importance with this organization, this indicates.

  5. steve7876 says:

    Best part of this post is he reaction of the Amazing Observatory of Rights and Freedoms (Observatoire amazigh des droits et libértés, OADL)
    Bath Towels

  6. Not sure exactly why GME is twenty five. This provider had been quit by using many people. Fix regarding consoles, continuous resales pertaining to new technique game titles, income regarding cellphones… almost all produce a scenario with regard to relevance with this business, this means that.

  7. I have not much time for it to stop by many web sites. Nevertheless nowadays I discovered this web site unintentionally. When i researched much data which can be useful to my life.

  8. Kolak says:

    These articles written too great, your blog absolutely fantastic! Keep updating the blog, looking forward for more contents sewa mobil semarang

  9. madelinemejes says:

    Your blog is really nice and unique.I like it so much..
    vacation rental koh samui

  10. simondoul says:

    People sometimes get injured in hotels. As such, you need to make sure you get the appropriate insurance for your hotel. You need to make sure you insure the hotel itself and any additional property owned by the hotel.   In addition to property insurance, you will need liability insurance for customer and workers compensation insurance for employees.

  11. hguhf 250 says:

    thanks for all this great and valuable informations …

  12. Online gaming is one of the best passion for online users now the days. We should keep ourselves in limit to remain focus on study and get highest marks in exams. We are providing best solution for you if you feeling weakness in research and writing.

  13. This service provider were being give up through the use of a lot of people. Correct with regards to gaming systems, constant resales pertaining to fresh strategy video game titles, income with regards to cell phones… just about all build a scenario with regards to relevance with this small business, which means.

  14. I just stumbled upon your blog and wanted to say that I have really enjoyed reading your blog posts. Any way I'll be subscribing to your feed and I hope you post again soon.

  15. Wow … I truly appreciate this blog post, great article ! You're the best writer

  16. dulhanwear says:

    Thanks for taking the time out to share this with the readers. I was greatly interested with what you have shared and posted with us.

  17. Very nice post. I just stumbled upon your weblog and wished to say that I have truly enjoyed browsing your weblog posts. Thanks dude

  18. tammytahreem says:

    lovely indeed jogos de moto

  19. card printer says:

    I am glad to found such useful post. I really increased my knowledge after read your post which will be beneficial for me.

  20. Hales says:

    Thanks for a very interesting blog. What else could I get that type of info written in such an ideal manner? I've a project that I'm just now working on, and I have been on the look out for such info.

  21. A good informative post that you have shared and thankful your work for sharing the information. I definitely enjoying every little bit of it and I have you bookmarked to check out new stuff you post.ARTICLE & SUBMISSION

  22. I just thought it may be an idea to post incase anyone else was having problems researching but I am a little unsure if I am allowed to put names and addresses on here ranked at #4

  23. Eu-Cigs says:

    Great idea, thanks!

  24. The veteran campaigner also described Cameroon as 'one of the most homophobic countries in the world' and said that President Paul Biya has 'queer blood on his hands'. He called for the former French and British colony to be suspended from the Commonwealth of Nations. making touch screen gloves

  25. For example, modern flow sensors should be able to precisely measure volumes from less than 1 litre to 250 litres per minute. I found it

  26. I always find such amazing posts on this website and today's post was really amazing. Thank you

  27. GameStop is more than a video game store. Every time I've gone into one, I've been amazed by the experience and knowledge of the salespeople, many gamers themselves.

  28. robinjack says:

    congratulations for that three companies remained on the steam clean
    list after making the researches. Good article

  29. Joining with post. I in a general sense discovered your site and wish to say that I have truly enjoyed the experience of examination your site posts. Any way I'll be subscribing to your site and I expect you post again in a section second.

  30. I like this weblog its a master peace or unique. Glad I found this on google search. I just wanted to give you a quick heads up! Other then that.

Leave a Reply

Protected by WP Anti Spam