August 27, 2021 3 min read

This story originally appeared on Zacks

GameStop (GME) closed at $204.95 in the latest trading session, marking a -0.13% move from the prior day. This change lagged the S&P 500’s 0.88% gain on the day.

Coming into today, shares of the video game retailer had gained 24.48% in the past month. In that same time, the Retail-Wholesale sector lost 4.22%, while the S&P 500 gained 1.2%.

Wall Street will be looking for positivity from GME as it approaches its next earnings report date. This is expected to be September 8, 2021. On that day, GME is projected to report earnings of -$0.42 per share, which would represent year-over-year growth of 70%. Meanwhile, our latest consensus estimate is calling for revenue of $1.12 billion, up 18.69% from the prior-year quarter.

For the full year, our Zacks Consensus Estimates are projecting earnings of $0.02 per share and revenue of $5.67 billion, which would represent changes of +100.93% and +11.4%, respectively, from the prior year.

Any recent changes to analyst estimates for GME should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company’s business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. GME is holding a Zacks Rank of #3 (Hold) right now.

Looking at its valuation, GME is holding a Forward P/E ratio of 10261. For comparison, its industry has an average Forward P/E of 12.08, which means GME is trading at a premium to the group.

The Retail – Consumer Electronics industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 24, putting it in the top 10% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.

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