GameStop (GME) will present its fourth quarter results, its first earnings report since the massive tightening fueled by Reddit after the market closed on Tuesday. GME’s shares fell after the departure of another high-profile executive.
X
GameStop earnings
Estimates: Analysts see earnings rising 15% to $ 1.46 a share, while revenue increases 2.2% to $ 2.24 billion, according to Zacks Investment Research. Same store sales are expected to rise 8.1%, according to Consensus Metrix.
Results: Check again after closing.
On Tuesday, GameStop announced that Frank Hamlin, its customer service director, will step down on March 31. Last month, Jim Bell, GameStop’s chief financial officer, announced that he was leaving the company on March 26.
Both exits come as an activist investor and Chewy.com (CHWY) co-founder Ryan Cohen pressures GameStop to renew its business model and add more offerings online.
Inventory: The shares fell 5.3% to 184.21 in the stock market today. GME’s stock rose to 483 at the end of January, but plummeted in February, before recovering slightly and falling again this month. GameStop shares remain above the 50 and 200 day lines, as well as the levels of the previous year, according to the analysis of the MarketSmith chart.
Among other actions at the top of Reddit, AMC Networks (AMC) fell 10%, and Discovery (DISCA) fell 5.6%.
IBD Live: a new tool for daily stock market analysis
GME Stock Short Squeeze Frenzy
GameStop found itself in the midst of a short-squeeze craze brought on by the Reddit r / wallstreetbets group, which intended to take on hedge funds that were betting the stock would fall.
A House Financial Services Committee questioned officials in February about the relationship between the trading app Robinhood and Wall Street, after the app imposed restrictions on GME shares and other Reddit short shares.
The short-squeeze may be running out of juice. A report by S&P Global Market Intelligence showed that short selling in general fell at the end of February, with short selling of GameStop shares falling more than 80%. The investment strategy of the Reddit r / wallstreetbets group needs heavily shorted stocks for quick gains.
Follow Gillian Rich on Twitter to invest in news and more.
YOU MIGHT LIKE:
You may be missing out on the 1.300% GME Stock Rally – and not knowing it
Explanation of GME stock options trading
Find the latest stocks that reach buying zones with MarketSmith
These are the 5 best stocks to buy and watch now
IBD stock of the day