Pacific Crest Rates GameStop (NYSE: GME) As Sector Perform Amid Concerns Over Fundamentals
March 19, 2010 8:23 AM
Analysts noted weak F2010 margins, but reported that Gamestop (NYSE: GME) continues to defend itself on multiple issues.
They explain that “GameStop addressed its recent CFO departure, the increase of videogame rental kiosks, the failure of certain used game kiosks and the decline in competition from the closure of several Game Crazy stores. Its response to each was as expected. The company is, to paraphrase ‘not being impacted by any competition, and its used game business is flourishing.’”
Pacific Crest also reports that “GameStop lowered its industry software forecast to between flat and 2%, down from strong single-digit to low-double-digit growth, although it did not address the reason behind this change.”
Analysts added that they believe GameStop’s underlying fundamentals remain weak. They concluded by saying, “We would point investors to other names in videogames.”
