GameStop Sees Unusually Large Options Volume (NYSE:GME)

Key Points

• Unusually large options activity: Investors bought 298,133 call options (about 59% above normal), as GME rose 3.1% to $24.78 on heavy volume (11.65M vs. avg. 7.28M shares).
• Mixed fundamentals: GameStop beat EPS at $0.49 vs. $0.37 but revenue missed ($1.10B vs. $1.47B expected), and Wall Street consensus remains bearish with an average target price of $13.50 and a "Reduce" rating.
• Insider activity: The general counsel sold 7,209 shares while a director bought 5,000, and insiders have net purchased 517,000 shares in the last 90 days, now owning 8.58% of the stock.

GameStop Corp. (NYSE:GME - Get Free Report) saw some unusual options trading activity on Wednesday. Investors purchased 298,133 call options on the company. This is an increase of approximately 59% compared to the typical volume of 187,700 call options.

GameStop Trading Up 3.1%

NYSE:GME traded up $0.75 during midday trading on Wednesday, reaching $24.78. 11,650,236 shares of the stock traded hands, compared to its average volume of 7,280,394. The company has a fifty day moving average of $23.64 and a 200 day moving average of $22.86. GameStop has a 12 month low of $19.93 and a 12 month high of $35.81. The company has a debt-to-equity ratio of 0.76, a quick ratio of 14.68 and a current ratio of 15.30. The stock has a market capitalization of $11.11 billion, a P/E ratio of 33.03 and a beta of 1.86.

GameStop (NYSE:GME - Get Free Report) last posted its quarterly earnings results on Tuesday, March 24th. The company reported $0.49 EPS for the quarter, beating analysts' consensus estimates of $0.37 by $0.12. GameStop had a net margin of 11.53% and a return on equity of 12.47%. The company had revenue of $1.10 billion during the quarter, compared to analyst estimates of $1.47 billion. On average, research analysts predict that GameStop will post 0.08 EPS for the current year.

Insider Buying and Selling

In other news, General Counsel Mark Haymond Robinson sold 7,209 shares of the company's stock in a transaction on Wednesday, April 1st. The shares were sold at an average price of $22.94, for a total value of $165,374.46. Following the completion of the sale, the general counsel owned 97,946 shares of the company's stock, valued at approximately $2,246,881.24. This represents a 6.86% decrease in their position. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through this link. Also, Director Lawrence Cheng acquired 5,000 shares of the business's stock in a transaction dated Friday, January 23rd. The stock was acquired at an average cost of $22.87 per share, with a total value of $114,350.00. Following the purchase, the director directly owned 88,000 shares in the company, valued at $2,012,560. This represents a 6.02% increase in their position. The disclosure for this purchase is available in the SEC filing. Insiders have bought 517,000 shares of company stock worth $10,925,150 in the last ninety days. 8.58% of the stock is currently owned by insiders.

Institutional Trading of GameStop

A number of institutional investors and hedge funds have recently added to or reduced their stakes in GME. Northwestern Mutual Investment Management Company LLC lifted its position in GameStop by 0.5% during the fourth quarter. Northwestern Mutual Investment Management Company LLC now owns 92,197 shares of the company's stock valued at $1,851,000 after buying an additional 463 shares during the period. Bessemer Group Inc. lifted its position in GameStop by 39.2% during the third quarter. Bessemer Group Inc. now owns 1,674 shares of the company's stock valued at $46,000 after buying an additional 471 shares during the period. Thrivent Financial for Lutherans lifted its position in GameStop by 0.5% during the second quarter. Thrivent Financial for Lutherans now owns 96,623 shares of the company's stock valued at $2,357,000 after buying an additional 511 shares during the period. Public Employees Retirement System of Ohio lifted its position in GameStop by 0.4% during the third quarter. Public Employees Retirement System of Ohio now owns 131,002 shares of the company's stock valued at $3,574,000 after buying an additional 578 shares during the period. Finally, Panagora Asset Management Inc. lifted its position in GameStop by 4.5% during the fourth quarter. Panagora Asset Management Inc. now owns 13,692 shares of the company's stock valued at $275,000 after buying an additional 594 shares during the period. Hedge funds and other institutional investors own 29.21% of the company's stock.

Wall Street Analysts Forecast Growth

A number of equities research analysts recently commented on GME shares. Wall Street Zen lowered shares of GameStop from a "hold" rating to a "sell" rating in a report on Saturday, March 28th. Weiss Ratings upgraded shares of GameStop from a "sell (d+)" rating to a "hold (c-)" rating in a report on Monday, February 2nd. One research analyst has rated the stock with a Hold rating and one has given a Sell rating to the company. According to data from MarketBeat, GameStop currently has an average rating of "Reduce" and an average target price of $13.50.

GameStop Company Profile

GameStop Corp. NYSE: GME is a global specialty retailer focused on video games, gaming consoles, consumer electronics and related accessories. The company operates a network of physical retail stores alongside an e-commerce platform, offering new and pre-owned products spanning the latest game software, hardware, collectibles and lifestyle merchandise. GameStop's retail footprint is complemented by digital marketplaces for trade-ins and online purchases, as well as a membership program that provides exclusive content and rewards.

Originally founded in 1984 as Babbage's in Dallas, Texas, the company adopted the GameStop name in 1999 following its merger with Software Etc.

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