Investors Buy Large Volume of Call Options on GameStop (NYSE:GME)

Key Points

• On Thursday, GameStop Corp. (NYSE:GME) saw a significant rise in options trading, with investors purchasing 340,652 call options, marking a 75% increase from the average daily volume.
• GameStop's share price increased by 5.0% to $23.61, with a total of over 10.5 million shares exchanged during trading.
• Despite recent activity, GameStop's stock currently holds a consensus rating of "Reduce" with an average price target of $13.50, following mixed reviews from analysts.

GameStop Corp. (NYSE:GME - Get Free Report) was the recipient of some unusual options trading activity on Thursday. Investors bought 340,652 call options on the company. This is an increase of approximately 75% compared to the average daily volume of 195,085 call options.

Analyst Upgrades and Downgrades

Several brokerages have issued reports on GME. Weiss Ratings reissued a "hold (c-)" rating on shares of GameStop in a research note on Wednesday, October 8th. Wedbush raised shares of GameStop to a "strong sell" rating in a research note on Tuesday, July 1st. One equities research analyst has rated the stock with a Hold rating and one has assigned a Sell rating to the company. According to MarketBeat, the stock presently has an average rating of "Reduce" and a consensus price target of $13.50.

GameStop Trading Up 5.0%

Shares of NYSE:GME traded up $1.12 during trading on Thursday, reaching $23.61. 10,581,726 shares of the company were exchanged, compared to its average volume of 10,625,081. The firm has a market capitalization of $10.57 billion, a PE ratio of 32.34 and a beta of -0.86. GameStop has a 12-month low of $20.48 and a 12-month high of $35.81. The company has a debt-to-equity ratio of 0.80, a current ratio of 11.37 and a quick ratio of 10.79. The business's fifty day simple moving average is $24.19 and its 200-day simple moving average is $25.20.

GameStop (NYSE:GME - Get Free Report) last issued its quarterly earnings data on Tuesday, September 9th. The company reported $0.25 EPS for the quarter, topping analysts' consensus estimates of $0.19 by $0.06. The company had revenue of $972.20 million during the quarter, compared to the consensus estimate of $823.25 million. GameStop had a net margin of 9.41% and a return on equity of 7.72%. GameStop's revenue for the quarter was up 21.8% compared to the same quarter last year. During the same quarter in the previous year, the firm posted $0.04 earnings per share. On average, research analysts anticipate that GameStop will post 0.08 EPS for the current year.

Insider Transactions at GameStop

In related news, insider Daniel William Moore sold 6,509 shares of the stock in a transaction dated Thursday, October 2nd. The shares were sold at an average price of $27.58, for a total value of $179,518.22. Following the completion of the transaction, the insider owned 112,620 shares of the company's stock, valued at approximately $3,106,059.60. This trade represents a 5.46% decrease in their position. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is accessible through this hyperlink. Also, General Counsel Mark Haymond Robinson sold 4,449 shares of the firm's stock in a transaction dated Thursday, October 2nd. The stock was sold at an average price of $27.58, for a total transaction of $122,703.42. Following the completion of the sale, the general counsel directly owned 112,302 shares of the company's stock, valued at approximately $3,097,289.16. The trade was a 3.81% decrease in their position. The disclosure for this sale can be found here. In the last ninety days, insiders sold 11,788 shares of company stock valued at $321,046. 8.58% of the stock is owned by insiders.

Hedge Funds Weigh In On GameStop

Several institutional investors and hedge funds have recently bought and sold shares of GME. Thrivent Financial for Lutherans grew its holdings in shares of 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 last quarter. Wealthfront Advisers LLC lifted its position in GameStop by 1.9% during the second quarter. Wealthfront Advisers LLC now owns 30,761 shares of the company's stock valued at $750,000 after purchasing an additional 576 shares during the period. Louisiana State Employees Retirement System raised its position in shares of GameStop by 0.5% in the second quarter. Louisiana State Employees Retirement System now owns 114,500 shares of the company's stock worth $2,793,000 after acquiring an additional 600 shares during the period. State of Michigan Retirement System raised its position in shares of GameStop by 0.6% in the second quarter. State of Michigan Retirement System now owns 97,900 shares of the company's stock worth $2,388,000 after acquiring an additional 600 shares during the period. Finally, UMB Bank n.a. raised its position in shares of GameStop by 17.4% in the second quarter. UMB Bank n.a. now owns 4,287 shares of the company's stock worth $105,000 after acquiring an additional 636 shares during the period. 29.21% of the stock is owned by hedge funds and other institutional investors.

About GameStop

GameStop Corp., a specialty retailer, provides games and entertainment products through its stores and ecommerce platforms in the United States, Canada, Australia, and Europe. The company sells new and pre-owned gaming platforms; accessories, such as controllers, gaming headsets, and virtual reality products; new and pre-owned gaming software; and in-game digital currency, digital downloadable content, and full-game downloads.

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