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Social Market Analytics Looks at Market Sentiment for GameStop

Social Market Analytics Looks at Market Sentiment for GameStop


This week, Social Market Analytics (SMA) looks at GameStop Corp. (NYSE: GME), a video game retailer, selling new and used video game hardware; digital video game software; and gaming accessories at over 6,600 locations in 17 countries worldwide.  As the week of November 12 evolved, shareholders of GME were solidly rewarded as the stock experienced a sustained rally and closed near 52-week highs.  Shares of GME rose 8.8% over a two day period, as the company reported Q3 earnings that beat estimates by $0.05 per share, which had analysts reiterate buy ratings and raise price targets for the stock to $29.00.  During the week, GME appeared twice on SMA’s morning Flash Report, which identifies stocks, in the pre-market, with extreme sentiment levels that are likely to trade with high activity during the upcoming session.  On the mornings of November 15 and 16, our analytics engine identified GME as a stock with high positivesentiment from the universe of stocks tracked by SMA.  SMA’s sentiment metrics provided early indication of positive price trends for GME as traders integrated the company’s positive earnings results and analyst recommendations.

Starting on Monday, November 12, SMA’s S-Score and S-Mean metrics for GME established an uptrend.  In the pre-market of November 13, GME’s S-Score stood at 2.02 (High Positive).  The stock closed the session at $23.26, up 3.3% from the close of the previous week.  The behavior of SMA’s S-Factors measures market trading sentiment and can provide actionable signals for upcoming price movement.  In the pre-market of November 15, GME’s S-Score increased to 2.81 (High Positive).  GME opened at $24.02, a gap up of 2.3%, and rallied to close at $24.50, for a gain of 4.3% on high volume.  Positive market sentiment persisted in the pre-market of November 16 with GME’s S-Score at 2.74 (High Positive), coincident with a spike up in GME’s S-Volume metric indicating unusually high social media activity for the stock.  GME opened on November 16 at $24.65, but continued to rally to end trading at $25.55, for another daily gain of 4.3% and at the net gain of 15.6% for the week.

Social Media data are noisy and complex.  A single metric is insufficient to understand sentiment behavior over time.  Our S-Factors are a family of metrics, including volatility, trend and volume measures, designed to provide a complete view of the social media signature for each security tracked in SMA’s database.  SMA's processing engine continuously updates our S-Factors, capturing overnight and pre-market sentiment activities. Clients receive sentiment reports, prior to the U.S. market open, and intra-day sentiment estimatesfor tracked stocks, on-demand.   Clients have access to our Sentiment Alerts feature, which provides real-time notification of changes in sentiment metrics for the stocks on a client’s customized watch list.  We invite the reader to visit our website; investigate our market sentiment metrics for GME, other stocks, industry sectors, and market indices; participate in our FAQ forum; and sign up for our Flash Report and Newsletter.


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