GameStop has had a wild ride in 2021, but the stock is still up 1,600% heading into its latest quarterly financial report
- GameStop shares have sung wildly this year, but are still up more than 1,600% in 2021.
- The company is expected late Wednesday to report a narrower loss of $0.83 a share.
- Shareholders at the video-game retailer elected Ryan Cohen as chairman at their annual meeting.
- See more stories on Insider’s business page.
Investors committing money toward seeing GameStop shares advance have helped propel them up by more than 1,600% so far this year, keeping the rally going despite massive volatility in 2021.
GameStop will release its quarterly report after regular-session trading closes Wednesday. It headed into the report with a new chairman as Ryan Cohen, its largest individual shareholder and co-founder of Chewy.com, was elected to the post by shareholders earlier in the day.
GameStop is among a handful of names in the midst of another rally in so-called meme stocks powered by retail investors working together to force a short squeeze on hedge funds looking to profit from bets that the share price will fall.
GameStop was the center of a similar rally in January that launched its shares to an all-time high of $483 from around $17 at the start of the year. The shares eventually dropped back to about $45 before steadily rising again.
The shares were up about 3% and trading above $310 each Wednesday afternoon, a modest move contributing to the gain of over 1,600% since the start of 2021.
The company, which runs more than 4,000 stores and e-commerce properties in 10 countries, is expected to post a fiscal first-quarter adjusted loss of $0.83 a share, according to a FactSet poll of four analysts. That would be narrower than its adjusted loss of $1.61 a share logged a year ago when the company was dealing with store closures because of the COVID-19 pandemic.
Wall Street and retail investors may also see an increase in GameStop’s revenue. Sales are expected to come in at $1.16 billion, higher than $1.02 billion notched a year earlier.
“We are trying to do something that nobody in the retail space has ever done,” Cohen, in addressing shareholders Wednesday, was quoted as saying by Bloomberg. “But we believe we’re putting the right pieces in place and we have clear goals: delighting customers and driving shareholder value for the long term,” he said. Cohen said he wouldn’t introduce a new strategy yet, according to the report.
GameStop in May launched a website that said it was hiring a team to build a platform for nonfungible tokens, or NFTs, digital collectibles that have recently boomed in popularity.
Bank of America last week said GameStop shares were no longer trading on fundamentals and rather were being swayed by non-fundamental factors including the number of conversations on Reddit related to the company, trading volumes, and short interest. The investment bank told clients it had stopped coverage of the retailer.