GameStop (GME) AI Stock Analysis

• Market Cap: $10.46B
• Dividend Yield: N/A
• Average Volume (3M): 5.74M
• Price to Earnings (P/E): 31.6
• Beta (1Y): 0.59
• Revenue Growth: -15.48%
• EPS Growth: 528.37%
• Country: US
• Employees: 6,000
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Specialty Retail
• EPS (TTM): 0.24
• Shares Outstanding: 447,908,700
• 10 Day Avg. Volume: 6,351,200
• 30 Day Avg. Volume: 5,743,586
• PEG Ratio: 0.06
• Price to Book (P/B): 2.15
• Price to Sales (P/S): 2.77
• P/FCF Ratio: 81.80
• Enterprise Value/Market Cap: 0.00
• Enterprise Value/Revenue: 0.00
• Enterprise Value/Gross Profit: 0.00
• Enterprise Value/Ebitda: 0.00
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 66 Neutral
• Price Target: $25.00 ▲(15.58% Upside)

GameStop's overall stock score reflects its improved financial performance and effective cost management, as evidenced by the recent profit surge. However, challenges remain in maintaining revenue growth and addressing valuation concerns. The technical indicators suggest mixed momentum, with short-term bullishness but potential overbought conditions. The absence of a dividend yield and high P/E ratio further weigh on the valuation score.

Positive Factors

Improved Profitability

Improved profitability indicates effective cost management and operational efficiency, enhancing long-term financial stability.

Cash Flow Strength

Robust cash generation enhances financial flexibility, enabling strategic investments and debt management over the long term.

Warrant Distribution

Warrant distribution offers new investment opportunities, potentially increasing shareholder value and market interest.

Negative Factors

Revenue Decline

Declining revenue suggests challenges in maintaining sales momentum, which could impact long-term growth prospects.

Competitive Pressure

New competitive products from Valve could pressure GameStop's market share, impacting its competitive position and growth.

Operational Efficiency

Low EBIT margin indicates inefficiencies that could hinder profitability and require strategic focus to enhance long-term performance.

GameStop Business Overview & Revenue Model

Company Description

GameStop Corp. is a leading retailer of video games, consumer electronics, and gaming merchandise, headquartered in Grapevine, Texas. The company operates through a network of retail stores and an online platform, offering a wide range of products including new and pre-owned video game software, hardware, and accessories. GameStop also provides digital gaming products and subscription services, catering to both casual and hardcore gamers. In recent years, the company has been focusing on transforming its business model to adapt to the rapidly evolving gaming landscape and the rise of digital downloads.

How the Company Makes Money

GameStop generates revenue primarily through the sale of video games, consoles, and accessories, both in physical stores and online. A significant portion of its income comes from the sale of new video games, but the company also profits from the sale of pre-owned games and trade-ins, where customers can exchange used games for store credit or cash. Additionally, GameStop earns revenue from its digital sales of downloadable games and in-game content, as well as subscription services such as Game Informer magazine and membership programs. Partnerships with major gaming publishers and console manufacturers also contribute to revenue, as GameStop often engages in promotional activities and exclusive game launches. The company's efforts to diversify its offerings and adapt to the digital gaming trend are key factors influencing its financial performance.

GameStop Financial Statement Overview

Summary

GameStop has shown notable improvements in profitability and cash flow generation, with positive trends in margins and cash flow metrics. The balance sheet reflects a healthier financial position with reduced leverage. However, the slight decline in revenue growth highlights ongoing challenges in the retail environment. Overall, the company is on a positive trajectory, but maintaining revenue growth remains crucial.

Income Statement

GameStop's TTM revenue shows a slight decline, indicating challenges in maintaining sales momentum. However, the company has improved its gross profit margin to 30.06% and net profit margin to 9.36%, reflecting better cost management and profitability compared to previous periods. The EBIT and EBITDA margins have also turned positive, suggesting operational improvements.

Balance Sheet

The company's debt-to-equity ratio has significantly improved to 0.85 in the TTM, indicating a more balanced capital structure. Return on equity has increased to 7.24%, showcasing enhanced profitability. The equity ratio stands at 50.26%, reflecting a solid equity base relative to total assets.

Cash Flow

GameStop's free cash flow has grown by 18.06% in the TTM, demonstrating strong cash generation capabilities. The operating cash flow to net income ratio is 0.60, indicating efficient cash conversion. The free cash flow to net income ratio is high at 0.97, suggesting robust cash flow relative to earnings.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	3.81B	3.82B	5.27B	5.93B	6.01B	5.09B
Gross Profit	1.17B	1.11B	1.29B	1.37B	1.35B	1.26B
EBITDA	242.80M	22.40M	26.50M	-247.20M	-284.60M	-174.00M
Net Income	421.80M	131.30M	6.70M	-313.10M	-381.30M	-215.30M
Balance Sheet
Total Assets	10.55B	5.88B	2.71B	3.11B	3.50B	2.47B
Cash, Cash Equivalents and Short-Term Investments	8.83B	4.77B	1.20B	1.39B	1.27B	508.50M
Total Debt	4.39B	410.70M	602.80M	616.60M	649.00M	1.05B
Total Liabilities	5.25B	945.60M	1.37B	1.79B	1.90B	2.04B
Stockholders Equity	5.30B	4.93B	1.34B	1.32B	1.60B	436.70M
Cash Flow
Free Cash Flow	568.70M	129.60M	-238.60M	52.30M	-496.30M	63.70M
Operating Cash Flow	583.50M	145.70M	-203.70M	108.20M	-434.30M	123.70M
Investing Cash Flow	-1.48B	265.10M	-33.20M	-222.70M	-64.80M	36.90M
Financing Cash Flow	4.15B	3.44B	-11.60M	-7.90M	1.20B	-55.40M

GameStop Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 21.63
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GME, the sentiment is Negative. The current price of 21.63 is below the 20-day moving average (MA) of 21.68, below the 50-day MA of 22.68, and below the 200-day MA of 24.43, indicating a neutral trend. The MACD of 0.19 indicates Negative momentum. The RSI at 48.53 is Neutral, neither overbought nor oversold. The STOCH value of 62.61 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for GME.

GameStop Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
EBAY	70 Outperform	$37.90B	18.25	42.43%	1.40%	4.89%	17.30%
GME	66 Neutral	$10.46B	31.59	7.58%	―	-15.48%	528.37%
BBY	62 Neutral	$15.20B	23.96	22.49%	5.11%	-0.95%	-48.28%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
ETSY	57 Neutral	$5.44B	38.26	―	―	1.98%	-20.98%
CRSR	57 Neutral	$721.51M	―	-5.88%	―	9.79%	63.17%
FNKO	48 Neutral	$184.37M	―	-32.77%	―	-11.32%	-165.08%

GameStop Corporate Events

GameStop Reports Q3 2025 Profit Surge Amid Cost Cuts

On December 9, 2025, GameStop Corp. announced its financial results for the third quarter ending November 1, 2025. The company reported net sales of $821.0 million, a decrease from the previous year’s $860.3 million. However, it achieved a significant turnaround in profitability, with a net income of $77.1 million compared to $17.4 million in the prior year’s third quarter. This improvement was attributed to reduced selling, general, and administrative expenses, which dropped to $221.4 million from $282.0 million. GameStop’s operating income also saw a positive shift, reaching $41.3 million from a loss of $33.4 million in the previous year. The company’s cash and marketable securities increased to $8.8 billion, and its Bitcoin holdings were valued at $519.4 million.

GameStop Issues Warrants to Shareholders and Noteholders

On October 7, 2025, GameStop Corp. announced the distribution of warrants to its shareholders and convertible noteholders, allowing them to purchase shares of common stock. The warrants, issued on the same date, are exercisable at a cash price of $32 per share until October 30, 2026, and are expected to trade on the New York Stock Exchange under the ticker ‘GME WS’ starting October 8, 2025.