UPDATE: Bank of America Initiates Coverage on GameStop on Next Console Cycle

In a report published on Friday, Bank of America analyst Curtis Nagle initiated coverage on

with a Buy rating and a $55 price target. In the report, Bank of America stated, "We are initiating coverage of GameStop (GME) with a Buy rating and a $55 price objective based on 14x our 2014E EPS. We base our multiple on GME's ability to capture more upside from the console cycle given its considerably higher market share compared to the last cycle, tempered by our expectation for a slower overall sales ramp. While GME has significantly outperformed the S&P YTD (+63% vs.13%), in our view, there is room for appreciation due to: 1) positive consensus revisions; 2) indicators including console pre-orders; and 3) short covering (31% shares short)." GameStop closed on Friday at $40.87.