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Posted on 1/10/23 at 3:25 pm to GhostOfFreedom
So it will be 2 years ago later this month that we had the crazy meme stock rally. At that time, we were told that regardless of the ridiculous valuations at the time, there was a bull case for company as things started to move back to the pre-pandemic normal and with Ryan Cohen and his Chewy crew joining the board.
So given 2 years, and considering it is a business that would have been especially impacted negatively by the pandemic shutdowns, then I would expect to see some positive data over the most recent 4 quarters of available data (Q4 2021 through Q3 2022) compared to 2 years ago (Q4 2019 through Q3 2020). Well let's look and see.
2 years ago Gamestop's gross profit was $1.4 billion, its EBIDTA was -$95 million, its operating income was -$182 million, and its net income was -$275 million. Pretty bad, but remember 2020 was expected to be bad and things were supposedly looking up so it must be better.
2 years later its gross profit is $1.25 billion, its EBIDTA is -$454 million, its operating income is -$525 million, and its net income is -$525 million. So across the board things are down pretty significantly with gross profit down $156 million, EBIDTA down $359 million, operating income down $343 million, and net income down $235 million.
So again removing the impact of the 2020 pandemic data alone should have resulted in better numbers for a company that was just going back to normal operating, but we were told that things were looking up, and yet other than gross revenue (before costs of goods sold is subtracting) EVERYTHING is down significantly.
And now with higher interest rates to slow aggregate demand and price increases BUT WITH a higher risk for a recession, I can't see anything but downside risk for a company like this, let alone reversing a trend that has not only gone in the WRONG DIRECTION but would require significant turnaround to just get back to where it was 2 years ago without the pandemic impact. On top of that, the cost to invest in any stock is much higher with higher interest rates.
Maybe the stock will rise, but the fundamentals do not support it at all and in fact support the complete opposite.
So given 2 years, and considering it is a business that would have been especially impacted negatively by the pandemic shutdowns, then I would expect to see some positive data over the most recent 4 quarters of available data (Q4 2021 through Q3 2022) compared to 2 years ago (Q4 2019 through Q3 2020). Well let's look and see.
2 years ago Gamestop's gross profit was $1.4 billion, its EBIDTA was -$95 million, its operating income was -$182 million, and its net income was -$275 million. Pretty bad, but remember 2020 was expected to be bad and things were supposedly looking up so it must be better.
2 years later its gross profit is $1.25 billion, its EBIDTA is -$454 million, its operating income is -$525 million, and its net income is -$525 million. So across the board things are down pretty significantly with gross profit down $156 million, EBIDTA down $359 million, operating income down $343 million, and net income down $235 million.
So again removing the impact of the 2020 pandemic data alone should have resulted in better numbers for a company that was just going back to normal operating, but we were told that things were looking up, and yet other than gross revenue (before costs of goods sold is subtracting) EVERYTHING is down significantly.
And now with higher interest rates to slow aggregate demand and price increases BUT WITH a higher risk for a recession, I can't see anything but downside risk for a company like this, let alone reversing a trend that has not only gone in the WRONG DIRECTION but would require significant turnaround to just get back to where it was 2 years ago without the pandemic impact. On top of that, the cost to invest in any stock is much higher with higher interest rates.
Maybe the stock will rise, but the fundamentals do not support it at all and in fact support the complete opposite.
Posted on 1/10/23 at 3:48 pm to Sgt_Lincoln_Osiris
quote:I think it's quite a strange assumption that people were going to otherwise spend their money on social activities and travel are going to shift it to gaming. Furthermore, this assumes that this will offset any losses from people who would have otherwise spent it on gaming. And I'm not sure I would call gaming cheap unless you already have a console and only buy cheap games. But if you have to spend $300+ on a console and $50+ per game, then it's not that cheap.
I'd argue quite the contrary. When spending tightens, this is affects travel and eating out. Video games are a cheap hobby.
Posted on 1/10/23 at 3:48 pm to GhostOfFreedom
Physical media is absolutely dead. Unless they're at the tip of the spear on the next beanie baby madness, they are guaranteed to flounder sooner than later.
Posted on 1/10/23 at 4:00 pm to m2pro
quote:And as a casual, at most, gamer with just a Nintendo Switch, I almost always buy games at Walmart or Target since it's usually more convenient (many more Walmarts and Targets than Gamestops and in places where there may not even be a Gamestop anywhere close).
Physical media is absolutely dead. Unless they're at the tip of the spear on the next beanie baby madness, they are guaranteed to flounder sooner than later.
And I don't know how common this is, but a few years back I was at the mall and was browsing games at Gamestop, and decided I wanted to buy The Legend of Zelda: Breath of the Wild and it was like $60. I was planning to run to Walmart anyways (and Target was across street from mall), so I looked to see if they had it, and sure enough it was $10 cheaper. So instead of buying it at Gamestop, I bought it at Walmart and would have gone across street to buy it at Target if I wasn't going to Walmart.
I haven't really looked closely enough to compare, but it seems to me that Gamestop does not have a much wider selection than Target/Walmart, let alone compared to buying online (either from any non-GameStop place or through the online stores on the consoles). So I don't see what advantage GameStop has at all.
Posted on 1/10/23 at 7:58 pm to j1897
quote:
How the frick does that help gamestop? Gonna be great listening to these guys whine on twitter like the AMC apes.
Because when they're spending more time at home, they think they can turn full time gaming into a job. They blame their current set-up for their poor performance so they go drop $2k on a PC or new console to be faster like the top streamers, as they record themselves with no one watching.
Posted on 1/10/23 at 8:05 pm to GhostOfFreedom
quote:
the nft marketplace (which is still in Beta) is going to be much more lucrative than the traditional retail part of the company. Almost, money for nothing as the NFT games start coming online.
I fully expect GameStop to announce they have laid off the entire nft marketplace team. Zero people use that nonsense.
Posted on 1/10/23 at 8:11 pm to UltimaParadox
quote:
I fully expect GameStop to announce they have laid off the entire nft marketplace team. Zero people use that nonsense.
They already have
quote:
This week, the world’s largest video game retailer, GameStop, laid off staff, particularly in its crypto and blockchain divisions, citing "weakened consumer confidence" and punishing inflation.
Posted on 1/10/23 at 8:32 pm to Sgt_Lincoln_Osiris
quote:So this started out with you saying people would resort to gaming instead of traveling and eating out, but now they’re trying to become full-time gamers and dropping thousands of dollars on it?
They blame their current set-up for their poor performance so they go drop $2k on a PC o
Posted on 1/10/23 at 8:58 pm to MusclesofBrussels
quote:
They already have
Well glad they are cutting unnecessary expenses. Just like AMC bankruptcy is inevitable. All these people going to figure out the stock will go to zero
Posted on 1/10/23 at 10:51 pm to GhostOfFreedom
quote:
Besides still have lots of business at the retail stores (and being able to close non productive ones because they paid off loans that were preventing them from doing so), the nft marketplace (which is still in Beta) is going to be much more lucrative than the traditional retail part of the company. Almost, money for nothing as the NFT games start coming online.
GameStop will get paid for the transactions and will get original sale and royalties on items they create. They already are.
Basically, if you don't jump on, you will be missing the next apple, microsoft, google, amazon. But, you do you. You probably missed those, too.
mans whole bull thesis just got destroyed lol
Posted on 1/11/23 at 2:04 pm to GhostOfFreedom
Sad.
Posted on 1/12/23 at 2:45 pm to buckeye_vol
quote:
sure enough it was $10 cheaper
This is one of many things that has improved under Ryan Cohen's team. Price matching and just flat out better pricing. You should also checkout the improvements on LINK In many cases they have free same day delivery (using something like door dash).
The real goldmine is going to be LINK They just listed 4 free web3 beta games yesterday and people are going bananas over them.
Posted on 1/12/23 at 2:47 pm to UltimaParadox
quote:
I fully expect GameStop to announce they have laid off the entire nft marketplace team. Zero people use that nonsense.
Check out the web3 games that launched yesterday. Still in Beta, but gamers are jacked!
https://nft.gamestop.com/
Posted on 1/12/23 at 2:49 pm to MusclesofBrussels
quote:
They already have
Wrong. You get your news from Crammer and Motley fool paid fud?
GameStop didn't extend contract developers on several teams, after their projects were completed. The didn't lay off their nft team.
Check this out (and it is just in Beta). https://nft.gamestop.com/
Posted on 1/12/23 at 2:51 pm to UltimaParadox
I don't understand the hatred for GameStop by so many of you. Are you short the stock?
Posted on 1/12/23 at 2:51 pm to JohnnyKilroy
quote:
mans whole bull thesis just got destroyed lol
How?
Posted on 1/12/23 at 2:53 pm to GhostOfFreedom
You look a little desperate. It will be the next APPLE you fools!!!
Posted on 1/12/23 at 2:54 pm to UpstairsComputer
Y’all buy pbla it might be lit
Posted on 1/12/23 at 3:03 pm to UpstairsComputer
lol, okay, I guess.
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