Wedbush Expects Solid Q3 Results For GameStop

In a report published Monday, Wedbush analyst Michael Pachter reiterated an Outperform rating and $60.00 price target on GameStop Corp. GME. In the report, Wedbush noted, “We expect Q3 results at the high-end of guidance. Our estimates are for revenue of $2.28 billion, comps of up 5%, and EPS of $0.66, versus consensus of $2.21 billion and $0.61, and guidance for comps of up 1 – 5% and EPS of $0.58 – 0.64. According to NPD, quarterly hardware dollar sales were up over 100% (we modeled GME at up 53%) and software dollar sales were down roughly 30% (we modeled GME at down 20%), resulting in roughly flat growth. We believe GameStop gained software market share from hardware strength, and drove comp upside from mobile and digital growth. Estimated implied 2H:14 revenue guidance for Technology Brands is $245 – 295 million (versus $130 million in 1H:14 and $63 million in 2H:13), with non-GAAP digital at $442 – 464 million (versus $369 million in 1H:14 and $399 million in 2H:13). Positive contributors to EPS are expected to include mobile and digital, as well as share repurchases (over $150 million in recent months). On November 12, GameStop announced a $0.33 quarterly dividend (unchanged) and a new $500 million share repurchase authorization.” GameStop closed on Friday at $44.40.
Market News and Data brought to you by Benzinga APIs
Comments
Loading...
date
ticker
name
Price Target
Upside/Downside
Recommendation
Firm
Posted In: Analyst ColorReiterationAnalyst RatingsMichael PachterWedbush
Benzinga simplifies the market for smarter investing

Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.

Join Now: Free!