GameStop Shares Tumble But Analyst Predicts 2010 Rebound
After poorer than expected sales this past holiday season, GameStop shares took a big hit on Friday.
It has been repoted that GameStop sales for the nine-week period ending January 2 were down 8.6% in comparison to 2008, which is significantly lower than most projections. As a result, GameStop stock fell drastically on Friday before reclaiming a bit of traction; the market closed with a share price at $20.46, which is a 15% decline. The company has also cut its fourth-quarter forecast as they're now predicting a fall of 8.5 - 9.5%, which is worse than the initial 4-7% expected decline. However, with the excellent software lineup for 2010, there's a good possibility that the retailer could rebound nicely. According to GamesIndustry.biz, Wedbush Morgan analyst Michael Pachter thinks both GameStop and the industry will come up this year:
"We believe that industry sales will rebound in 2010 and that GameStop is well positioned to gain share the first half of the year. The company has high exposure to the hardcore software releases, which we expect to drive market growth in 2010, and comparatively low exposure to hardware, which we expect to decline."
He also adds that GaemStop's "appeal to hardcore gamers will become increasingly important as Wii sales stagnate and Q1's long-awaited slate of games comes to market." See? This is what happens when too many blockbusters get pushed out of a holiday season; we get a jam-packed first quarter and lower-than-anticipated holiday sales. Next time, publishers, don't be so damn frightened of games like Call of Duty: Modern Warfare 2. ...okay, well, maybe you should be.
1/8/2010 8:57:36 PM John Shepard