/biz/ - Business & Finance

>>23416129
well either way Gamestop benefits now, whether they sell an Xbox X or and Xbox S
i really doubt digital is going to take off when internet plans with limited bandwidths are still widespread in NA

i mean we already know that, although GME may have been ordering fewer digital editions obviously

>>22918187
there's still a lot of uncertainty around GME, corporate is shitty, 102% short interest of outstanding shares
they're going to be shocked by Q4 earnings though. Everyone thinks this is going to be worse than PS4's dissapointment when anyone who's following AMD and vidya in general should know otherwise how massive this console cycle is

on top of a corona gaming boon

>>22702814

>>22637260
You heavily overestimate Amazon's dominance in e-commerce right now especially when they've stopped doing same-day delivery while Gamestop does that now for vidya shit. Amazon doesn't have lower prices and Gamestop has pretty decent rewards/incentives to keep buying from there. Powerup rewards member card thing should be around 60 million customers from what I remember off the top of my head.

You could ignore the brick & mortar revenue entirely and GME would still be fairly valued. $200 million e-commerce revenue from Q2. GME still valued $500 million market cap company after the Q2 dip. Overall $1 billion revenue for Q2 and GME's past the worst of it already, no more covid/riot cashburn or end-of-cycle woes. ~50 million shares short betting on GME going to $0 and they are already wrong.
Debt isn't an issue either, they have enough cash to pay off all their bonds and be left with $300 million. Basically $700 million liquidity at the start of a console cycle, for a company with a $500 million market cap. Gamestop still gets a cut from digital sales because they bundled $100 playstation store and playstation plus cards with the PS5 digital editions. Also pic related, either due to customer preference or retailers purposely stocking less of the digital edition (pretty smart move).

It's only this undervalued because of market shenanigans by short sellers. They ALL have to buy back in eventually unless they want to keep paying 50% interest.

>>22619573
>https://iborrowdesk.com/report/GME
your negative assumptions about Gamestop is exactly why the trade is *STILL* severely overcrowded with short sellers. And unlike April's mini squeeze that only pumped it like double the price, this time bankruptcy is not a possibility for at least 2 years given the balance sheet and the console cycle.
Previous shorts cover, but newer shorts enter clueless to the momentum of the double console hype. Clueless that digital sales taking over all sales or whatever was completely overblown. Clueless than GME's ecommerce grew massively by Q2 because Amazon doesn't do same-day delivery anymore or have lower prices on top of other things that GME improved on.

At 50% interest rates, shorts that don't cover will break even only if Gamestop goes to $0 in 2 years. If a squeeze doesn't happen, we'll still get a short burn as they have to cover eventually.