Barron's recently published an article with a negative stance on GME. The key thesis points we saw were as follows:
- Falling sales “We’re not seeing anything to get excited about. They’re missing numbers, not beating numbers.”
- Valuation: 11x EBITDA, trading similar to TGT.
- Shift to online download of games, referencing digital growth on recent quarter.
- “Many of GameStop’s stores are inside malls”.
- Scion reducing its stake. (3% portfolio position that went up ~4x)
We give our pushback on these points in a brief video. To access the video: CLICK HERE
For a replay of our full Black Book on GME (and BBY) from December: CLICK HERE
