GameStop Corp Holding Company (GME) Quote

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🟩GME: GameStop is beginning a newfound, technical breakout🟩

I wouldn't want to miss this... if I were you...

$GME (bullish, apish)
#GME (bullish, apish)

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Did Anyone Notice GameStop Reinvented Itself On The Latest Kitty Call? (Rating Upgrade)
Sep. 20, 2024 9:00 AM ETGameStop Corp. (GME) Stock16 Comments
Paul Franke profile picture
Paul Franke
24.69K Followers

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(8min)
Summary

Roaring Kitty's reappearance with a large GameStop position in May, helped the share quote to rise from $12 to $60+ in quick order.
GameStop's management issued $3.05 billion in new shares during May-June, reshaping the balance sheet with $4.2 billion in cash vs. just $1.15 billion in liabilities.
Positive net income and potentially stronger returns on the reinvestment of its large cash holdings could force Wall Street to rerate shares much higher.
The reinvented company 12 months from now could be worth materially more than existed in the spring, through timely financial engineering decisions.
Creative light bulb explodes with colorful paint and splashes on a black background. Think differently creative idea concept
Alones Creative
I am the knucklehead that called for a GameStop Corp. (NYSE:GME) short squeeze time and again for years, before the massive price increase of late 2020 and early 2021. Unfortunately for my brokerage account, I did not own any shares when the event actually hit shares. Hindsight is always 20/20, I guess. Without doubt, going long a stock sitting at greater than 300% of float "short" can work to your benefit in spectacular fashion.

StockCharts.com - GameStop, Daily Price & Volume Changes, August 2020 to January 2021
StockCharts.com - GameStop, Daily Price & Volume Changes, August 2020 to January 2021
YCharts - GameStop, Short Position as Percentage of Float, Since 2010
YCharts - GameStop, Short Position as Percentage of Float, Since 2010
However, following the Meme stock explosion of +10,000% intraday and +8,000% on a daily closing basis over six months (akin to winning the lottery), I have been telling readers to avoid GameStop with its break-even to money losing operations, minimal net book value as a foundation for price, and way, way too much investor optimism part of the equation.

https://seekingalpha.com/article/4472163-meme-stock-craze-ending-gamestop-worth
Seeking Alpha - Paul Franke, GameStop Article, November 28th, 2021
Well, if you haven't been paying attention, the investment story has changed dramatically over the past few months. On the latest "Roaring Kitty" (Keith Gill) call for his Meme army to buy shares, GameStop management actually did something smart. They decided to issue new equity shares for $3.05 billion in cash (through two offerings, one during May and another in June), totally reshaping the company's balance sheet.

StockCharts.com - GameStop, 18 Months of Daily Price & Volume Changes
StockCharts.com - GameStop, 18 Months of Daily Price & Volume Changes
Net Income Turning Positive

At the end of its June quarter, the company held $4.2 billion in cash vs. $1.15 billion in total liabilities. The good news is this large cash hoard is earning interest and will help to paper over continued GameStop retail store losses. Even better news for shareholders may come when management (CEO Ryan Cohen) decides to put this extra liquidity to work. For example, if returns on the cash transition from 5% yields to owning a new business unit delivering 10% in earnings and 15% in cash flow on the purchase price, today's very bearish Wall Street sentiment will be forced into rerating shares much higher.

How bearish have analysts become? Well, the below projections have yet to fully account for the additional $150+ million in pre-tax annual cash-investment yield on the recently raised capital.

Seeking Alpha Table - GameStop, Analyst Estimates for FY2025-27, Made September 17th, 2024
Seeking Alpha Table - GameStop, Analyst Estimates for FY2025-27 (Ending January), On Sept 17th, 2024
YCharts - GameStop, Analyst EPS Forecasts for FY2025-27, Not Accounting For Cash Returns
YCharts - GameStop, Analyst EPS Forecasts for FY2025-27, Not Accounting For New Cash Returns
In all likelihood, the new GameStop organization as a whole should be nicely profitable going forward. My thinking is this realization by investors and analysts alike could provide one catalyst for rising prices soon.

The Q2 operating statement released last week (September 10th, 2024) highlighted an unexpectedly positive EPS number, which fell on deaf ears focused on the big drop in retail gaming sales at GME stores and online websites. The good news is this total included only several weeks of interest income on the extra cash stash.

https://investor.gamestop.com/news-releases/news-release-details/gamestop-discloses-second-quarter-2024-results
GameStop - June 2024 Q2 Press Release
Improved Valuation

I am very old-school in my thinking sometimes, with my Wall Street education and experience starting in 1986. Back then, earnings and book values were the two primary financial analysis focal points for many equity investors. Below I have graphed the price to tangible book value reading since late 2017. Over the past seven years only the 2019-20 levels were lower than today's 1.9x ratio. I would say the equity raise has done wonders for putting in a critical value support for all shareholders, especially if you have waited to buy a stake until now.

YCharts - GameStop, Price to Tangible BV, 7 Years
YCharts - GameStop, Price to Tangible BV, 7 Years
Another important stat to ponder is the enterprise valuation (equity + debt - cash holdings) on sales is well within the normal range vs. gaming developers and the electronics retailing world. Remember, GameStop's 0.97x ratio is down dramatically after the stock issuance effort raised loads of cash. Plus, this surplus liquidity could vastly increase sales through business acquisitions soon.

YCharts - GameStop vs. Gaming/Electronics Retail Peers, EV to Sales Ratio, 1 Year
YCharts - GameStop vs. Gaming/Electronics/Retail Peers, EV to Sales Ratio, 1 Year
Final Thoughts

I suppose my point is the logic to be short GameStop no longer exists. The company was already moving toward a breakeven operating profit setup at its flagship retail operations (on store closings and layoffs). Then, it added an enormous backstop of cash to move into other business fields, if management chooses.

Ryan Cohen now has the ability to scoop up any bargains that appear in the retail or ecommerce or gaming industries, at his discretion. One realistic possibility is GameStop morphs into more of a diversified holding company, with investments in outside equities, and perhaps some smaller, wholly owned units. Similar to what Warren Buffett built at Berkshire Hathaway (BRK.A) (BRK.B), today's GameStop is not the same company as existed in the springtime. And, it may look quite different again in 12-18 months.

I will say, share sell volumes have tailed off significantly since July, while numerous technical momentum indicators have been acting constructively for weeks. Below I have circled in gold the On Balance Volume bottom months ago. Plus, the 14-day Chaikin Money Flow and 13-day Force Index readings have stabilized or moved into positive territory during September. What if the emotional selling by Meme chasers is ending (buying high in May-June and selling low today), and only strong-hand holders of the stock remain?

StockCharts.com - GameStop, 3 Months of Daily Price & Volume Changes, Author Reference Point
StockCharts.com - GameStop, 3 Months of Daily Price & Volume Changes, Author Reference Point
Who knows? Maybe Roaring Kitty and Mr. Cohen have additional tricks up their sleeves to shake out the final holdouts of short interest. I am not banking on it, but you won't get paid unless you play (own the stock) under this possible trading scenario.

It's hard to quantify an upside share price target, as business operations are bound to change in unpredictable ways over the next year. Really, you have to trust Mr. Cohen can charter a brighter future for GameStop shareholders investing in outside businesses soon.

What are the risks? Absent a general stock market crash on Wall Street, making a rotten deal or two with the $4+ billion in cash would keep the stock quote under $20 in 2025.

However, I cannot find a level-headed reason to be bearish with a market capitalization of just $8.5 billion, against $1.15 billion in total liabilities. I believe GME could deliver $200 million to $250 million in free cash flow using its present configuration over the next 12 months (close to $200 million in net pre-tax income from 5% cash yields), with opportunities to improve upon this sum later in 2025. That's the way I see it, anyway.

I am upgrading my GameStop view from Hold to a speculative Buy, for a 12-month outlook. I do not currently own shares, but am looking to enter a position, especially on price weakness. The 200-day moving average around $19 should provide modest technical support. Prices under $15 are rather improbable with roughly $10 in cash per share.

Thanks for reading. Please consider this article a first step in your due diligence process. Consulting with a registered and experienced investment advisor is recommended before making any trade.
This article was written by

Paul Franke profile picture
Paul Franke
24.69K Followers
Nationally ranked stock picker for 30 years. Victory Formation and Bottom Fishing Club quant-sort pioneer.....Paul Franke

Thesis is shorts have not covered



Hold her monke hold her

GLTA

*****Wowzah🟥🟥🟥🟥 Power2theGMEshorters/brilliant, interest has faded big time here

ENOUGH SAID

Power2 the P1ayers Huzzah!🟩24/7 interest here🟩 🟩

Let the games begin



GLTA

Did he move to France???

If so

He can live out his life there

As the French don’t recognize US financial laws

https://www.justice.gov/usao-wdwa/pr/french-prosecutors-determine-there-are-no-grounds-appeal-mastro-extradition-ruling

Just ask the DOJ

GLTA

I believe someone knows something that we can only speculate about

https://www.reddit.com/r/Superstonk/comments/1ff69jp/current_gme_pattern_is_way_different_than_in_the/?chainedPosts=t3_1fg6a2b%2Ct3_1fdt18w%2Ct3_1fmknxs

But I tend to agree with the others

GME has put up shares for sale ready for a tippy top event price event that is coming

I think they will sell 1 million share blocks at intervals knowing when the prices are going higher for longer

I’m thinking that when this event comes

We and GME will be sitting pretty

I’m thinking that GME will at the end of the day will have tripled his Jimmy Cash by the EOM

Everyone thinks that they are selling shares for a measly $400m for 20m shares

When it’s going to be $8b for 20m shares

Which yes I believe we will see $400 PPS

Very soon

Call me crazy but $80 was just a taste

GLTA

yeah.......... and

Andrew Left changed his name to Andrew Right and now the authorities can't find him.

It seems things are heating up all over the market. Strange things are beginning to manifest themselves.
Desperation is more evident than in any prior time I can remember.

Maybe not on this particular thread, but it does seem other threads are seeing an increase in FUDsters.

Rest easy.......... we have the easy part. Buy and hold.

"They" are so FUNKED in my not so humble opinion.

CME collateral requirements

https://www.cmegroup.com/solutions/clearing/financial-and-collateral-management/acceptable-collateral.html

Many caps for total collateral through various asset classes

GLTA

Bank shut downs escalating…

By Oct 1st, banks are required to comply with Basel III regulations.
After this date, U.S. Treasury bonds will no longer qualify as collateral under Basel III.

Bank shut downs escalating…

By Oct 1st, banks are required to comply with Basel III regulations.
After this date, U.S. Treasury bonds will no longer qualify as collateral under Basel III. pic.twitter.com/W5eSztCSWc— xoom (@Mr_Xoom) September 20, 2024

Who’s got the Kitty’s Back??



Cuz I got the belly

GLTA

Some nice price action here yesterday. Maybe it hits $28 this week

Wayne R, The targeted acquisition cost more than $4.2 billion, maybe….

*****Wowzah🟥🟥🟥🟥 Power2theGMEshorters/brilliant, interest has faded big time here

ENOUGH SAID

Game of thrones

Cash is king



GLTA

I suppose the question is, why issue more shares if they are flush in cash?

Power2 the P1ayers Huzzah!🟩24/7 interest here🟩 🟩

***** LOL . Big deal ! GME ( Gameturd ) has broken through resistance and borken through support time and time again__ Wh👀ps

ENOUGH SAID

$GME Blasted through resistance today!

#GME 🔥 what's up? $GME

$38M buy at the end of day for GS…. Time to play chicken…

*****🅰️🅰️🅰️ Boogeyman Bankers making a killing off off of GME and going strong , 900 bankers strong!!!! , Short Squeeze no where near happening here , already happened in 2021 , whoops






ENOUGH SAID

Here we go



Wait for the pain

GLTA

Boogeyman Bankers insolvent and going defunct. 900 bankers removed and suffering. Short Squeeze Imminent.




[img]
https://external-content.duckduckgo.com/iu/?u=https%3A%2F%2Fi.ytimg.com%2Fvi%2FgAubQLy2S_c%2Fhqdefault.jpg&f=1&nofb=1&ipt=84228840b99f2b73d6baf95ed2731273bd9ce7789480b5e637873b5a477e49b2&ipo=images[/img]

*****GME shareholders ( bagholders ) are absolutely terrified , it's going to be the biggest disaster ever here





ENOUGH SAID

Shorts are absolutely Terrified. It's going to be big!

$92M dark pool order just came through for $GME

4,670,078 shares (those with Webull saw this volume on the 1 minute chart)

$92M dark pool order just came through for $GME

4,670,078 shares (those with Webull saw this volume on the 1 minute chart) #GME caught with @unusual_whales pic.twitter.com/nrt0LVhITJ— Wolf of My Street🏡 (@Ryan__Rigg) September 20, 2024

Sounds good for next week, I like it

*****🅰️ LOL 🅰️ ,Sure it will . Just like the GME rip to the closing bell on earnings day huh , just like the rip after hours that never happened and just like the rip that never happened the next day huh ?



Not going to happen period

ENOUGH SAID

!

Next week is going to be Big. Have a great weekend everyone.

They're in the black and why estimates didn't mean shit coming from the crooks of Wall Street.

Over 4+ Billion in the Bank

The Dip before the Rip!



Shorts to be seriously crushed. Seriously Crushed!

GME: 62 Million shares transacted today ("ok" volume)

I like volume...

See you all next week. Don't miss the party.

Have a fantastic weekend in the sun.

$GME
#GME

Looks like the 20m share offering is completed

Now it’s time for the price change and obligations to get repriced

If any swaps contracts are required to be closed EOM is just around the corner

RK yolo update weekend

RK Utube hit 1m subscriptions
count down hit zero?? FOMO rockets

It’s been reported German market today hit the circuit breaker halt for 5min today

Now we wait for Monday price action verification
Robin Hood Sunday delivery
German market Monday delivery
Pre market delivery Monday

Then options contract purchase

GLTA

Todays volume 60 mill

That seriously happened.

something is brewing here, too much volume for GME with no real news

today is the first time i have ever seen GME and AMC diverge in price and volume so vastly since before 2021

im not sure what to make of it, but it is meaningful

is GME getting loaded for a much bigger move?

Never underestimate karma

AS SOON AS ALLEGEDLY ROARING KITTY PURCHASED 5 MILLION SHARES TODAY GOLDMAN SACHS PRICE GLITCHED AND FELL 99%

COINCIDENTLY GOLDMAN ALONG WITH MANY OTHER OF THESE MAJOR BANKS WORK WITH HEDGE FUNDS TO SHORT STOCKS LIKE $GME

SQUEEZE…

GME up 11% AMC boring as fk

did the algo connecting them break?

Funny how Karma works

The destruction of others

Leads one to their own demise

GLTA

That’s true:)))))))

Latest "offering" gets GME towards $5 Billion free cash

$GME
#GME

Roaring Kitty bought $95 Million more this morning?

$GME
#GME

*****Wowzah🟥🟥🟥🟥 Power2theGMEshorters/brilliant, interest has faded big time here

ENOUGH SAID

Power2 the P1ayers Huzzah!🟩24/7 interest here🟩 🟩🟩

GME AMC algo pair trade broken? disconnected

GME up 8% on 21M volume

AMC down on 8M volume

have the two completely separated in meme pumping?