GameStop Considers Acquisition to Boost Business and Stock Prices
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Jun 06 2024
0mins
Should l Buy GME?
Source: Coinmarketcap
GameStop Corp's stock rose 5.02% as it crossed above the 5-day SMA, reflecting positive investor sentiment.
The company's CEO, Ryan Cohen, announced in a recent interview that GameStop is considering acquiring a retail firm to utilize its cash reserves effectively, aiming to revitalize the business and enhance stock prices by reducing its physical store footprint. Notably, investor Michael Burry supports this strategy, suggesting a potential investment of over $10 billion for a quality acquisition, which could significantly transform GameStop's future. Despite a challenging past year, with a 36% decline in 2025, the stock has shown resilience with a nearly 14% increase in early 2024, bolstered by positive market sentiment and strategic cost-cutting measures.
This acquisition strategy, coupled with a strong cash position, could position GameStop favorably in the market, attracting further investor interest and potentially leading to a more sustainable business model.
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Analyst Views on GME
About GME
GameStop Corp. offers games and entertainment products through its stores and ecommerce platforms. The Company operates in four geographic segments: United States, Canada, Australia and Europe. Each segment consists primarily of retail operations, with the significant majority focused on games, entertainment products and technology. The Company has a total of approximately 3,203 stores across all of its segments: 2,325 in the United States, 193 in Canada, 374 in Australia, and 311 in Europe. Its stores and ecommerce sites operate primarily under the names GameStop, EB Games and Micromania. Its Australia and Europe segments also include 38 pop culture-themed stores selling collectibles, apparel, gadgets, electronics, toys and other retail products for technology enthusiasts and general consumers in international markets operating under the Zing Pop Culture brand. Its retail stores are generally located in strip centers, shopping malls and pedestrian areas.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- CEO Strategic Shift: CEO Ryan Cohen has described Bitcoin primarily as a macro hedge but has downplayed its importance relative to other capital allocation priorities, indicating a shift towards pursuing M&A opportunities that may alter the company's investment strategy.
- Stock Performance: Despite the decline in Bitcoin holdings value, GameStop's shares have risen over 22% year-to-date, reflecting a positive market response to its new strategy and attracting speculative buyers' interest.
See More
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See More
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- Insider Buying Continues: Michael Burry disclosed via Substack that he is accumulating GameStop shares, viewing the stock as trading near tangible book value, while Cohen purchased one million shares last week at approximately $21, increasing his stake to about 9.3%, demonstrating executive confidence in the company's future.
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See More
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- Investor Confidence: Notable investor Michael Burry recently disclosed a long position in GameStop and suggested several potential acquisition targets, including ADT and Wayfair, which further boosted market optimism, as evidenced by rising sentiment on Stocktwits.
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