Bank Of America Sees Continued Next-Gen Momentum As Good For GameStop Corp.

In a report published Friday, Bank of America analyst Curtis Nagle reiterated a Buy rating and $56.00 price target on GameStop Corp. (NYSE: GME).In the report, Bank of America noted, “NPD reported that US software sales in August decreased 20%. This compares to a 15% decrease in July. While down 20% sounds bad (headline may pressure the stock today) it was against a tough compare (+23% LY), accelerated significantly on a 2yr basis (best rate since the launch of Watch Dogs in May) and has no negative implications for the cycle. Madden was the only major release, ex. Diablo III, a PC port, in the quarter and it outsold LY's version.We also note that three other titles were released last August and while each on their own were not big, on a combined basis they were meaningful. Looking forward, September is a critical month as it marks the launch of Destiny. We are very encouraged that on the first day of sale the title achieved over $500mn (10mn units). We believe GME over indexed in the title with strong digital attachment. We also believe this on its own will go a long way to help offset a very tough GTA V comparison.”GameStop Corp. closed on Thursday at $43.96.