What is the saddest story the How do stock markets work? A stock market is a financial ... More has to offer during these turbulent days? It’s probably the story of GameStop Corp. The company’s stock fell by 26% on Tuesday continuing its steep What is a downtrend in trading? When the price of an asset... More and approaching the record lows. Are there any reasons to buy GameStop while it’s so cheap?
Why is it important?
Previously we wrote about GameStop at the start of April, when the stock used to cost about $10. Now the What are value stocks? A value company is a company that app... More is below $6. The negative factors we mentioned earlier haven’t gone away. As e-commerce thrives and various offline retailers suffer, it turns out that selling video games in brick and mortar stores is the worst idea among all.
For What are value stocks? A value company is a company that app... More
The most recent move to the downside was caused by the announcement that GameStop halted its quarterly What is a dividend? A dividend is a payment made by a comp... More and reported a 13.3% fall in Q1 revenue.
The main problem for the company is in its declining sales. People are reluctant to buy consoles as they await new models from Sony and Microsoft. In addition, it has become more convenient to download video games than to go shopping for their physical versions. Game streaming is another nemesis of GameStop and this enemy has only started its ascent.
The Money is a generally accepted medium of exchange to buy and... More that will be free after GameStop’s decision not to pay dividends ($157 million a year) may be invested in some kind of transformation, but it’s very hard to see what the company can do to stop itself from sinking. Add the fact that it has a $500-million Debt is a type of liability. It is an obligation by one pa... More burden and you will like the situation even less. All in all, it seems that there’s little sense in trying to “catch the falling knives” with this stock.
The monthly chart looks awful enough. The downside may stretch to the 2003 low in the $4 area. The What is price? The price is the measure of the value of good... More may regain some footing if it manages to return above $8. However, given the fact that there are no fundamentals to buy the stock, it’s hard to expect that anyone will.