A number of people have been investing in GameStop stock. Earlier this year, the company attracted some attention when institutional investors decided to sell GameStop stock and nearly destroyed it. However, the company survived in part due to the efforts of a Reddit group of retail investors called WallStreetBets, who launched a campaign to buy GameStop stock. The stock went on to reach a new all-time high before settling at under $200.
Despite its impressive performance, GME stock still remains a gambler’s stock. Despite its recent back-testing, GME stock continues to give up gains as it marks lower highs. However, a successful breakout requires a combination of a few different factors. When the stock is in an uptrend, its price will likely move up again, and the IBD indicates that institutional investors are buying. As long as GME stock is trading near or above resistance, this is a good short entry.
A recent SEC report shed light on the GME stock trading activities in January 2021, and outlined the implications for investors. In the meantime, savvy traders should focus on short-term strategies. Look for the best opportunities and avoid trading on the edge of losing money in the short-term. For example, buy stock only when it is trending up. Alternatively, if you’re a speculative trader, you should look for a broker who specializes in game stocks.
GME stock was also a victim of the GameStop short squeeze, which resulted in a dramatic surge in January. In addition to this, a rally by Redditors forced the company’s value above $200. The subsequent rally further fueled the gains, with GME stock spiking by 1,600%. The company now ranks among the S&P Midcap 400, a diversified index of small-cap stocks.
After the massive rally in the first half of January, GameStop confirmed that it would launch an NFT marketplace. However, the stock fell 10% in the past 24 hours. This may be due to stifled performance in the previous year. Despite the disappointing results, the stock rose over 100% in early 2018, and Reddit users were the driving force behind the revival. Many investors bought the stock as a hedge against hedge funds.
The stock’s fundamentals are weak. Despite its growth, GameStop is expected to lose $59 million and lose 82 cents a share in fiscal 2023. Next generation consoles have boosted the company’s top line, but at a low profit margin. With weak fundamentals, GME stock is trading at a poor EPS rating of 44. It isn’t surprising that analysts aren’t recommending the stock.