GameStop (GME): Piper Jaffray Sees Catalysts Through Out 2016
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Rating Summary:
3 Buy, 11 Hold, 8 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 13 | Down: 11 | New: 14
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Piper Jaffray analyst, Michael Olsen, reiterated his Overweight rating in shares of GameStop (NYSE: GME) and believes that Pokémon Go, a mid-cycle refresh and VR may be catalysts throughout '16.
GME is up nearly 20% in the past month (+4% for the S&P), which is the result of hype around Pokémon Go and optimism regarding potential impact from an upcoming midcycle hardware refresh; the analyst believes shares are poised to continue this upward move. While we do not expect Pokémon Go to be a driver for material revenue upside, it is pushing traffic into stores and we believe creates an opportunity for GameStop to achieve/exceed its target of growing collectibles ~50% in FY16 (~$475M). More impactful to estimates in late '16 and into '17 is an updated slate of hardware. Microsoft, Sony and Nintendo all have new/updated hardware coming in '16 and '17; historically, new hardware has drawn gamers into retail. While GameStop faces headwinds from digital full game downloads, we believe there are some near-term catalysts for GME shares with the mid-cycle console refresh, VR and Pokémon Go.
No change to price target of $41.
**GME is up 21% after being highlighted in the Stealth Growth Insider newsletter on 6/27. For a free trial, click here.
For an analyst ratings summary and ratings history on GameStop click here. For more ratings news on GameStop click here.
Shares of GameStop closed at $30.81 yesterday.
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