Friday, December 16, 2022
HomePersonal FinanceGameStop stock heads for sixth straight drop ahead of earnings report

GameStop stock heads for sixth straight drop ahead of earnings report

Shares of GameStop Corp. extended their slide toward a 3 1/2-month low Wednesday, as investors prepared for the videogame retailer’s fiscal second-quarter report due out after the closing bell.

The “meme stock”
GME,
-4.63%

slumped 4.5% in morning trading, and was headed for a sixth straight loss, and 14th loss over the past 15 sessions. It has tumbled 23.9% over the latest losing streak and plunged 43.1% over the past 15 trading days.

GameStop is scheduled to report results for the quarter through July just after 4 p.m. Eastern. Analysts surveyed by FactSet expect the company to report a per-share loss of 42 cents, which would be the sixth consecutive quarterly loss.

The FactSet revenue consensus is $1.27 billion, up 7% from a year ago.

Both the per-share loss and revenue consensus have remain unchanged since the end of June, according to FactSet.

The company has reported a wider-than-expected loss the previous four quarters, even as it has beat revenue expectations the past five quarters. The five-quarter streak of beating revenue estimates followed a nine-quarter streak of misses.

Although GameStop’s stock has rallied the day after the previous two earnings reports, history suggests investors have a reason to anxious.

The day after the previous 20 quarterly reports, the stock has fallen 14 times, by an average of 14.6%, according to a MarketWatch analysis of FactSet data. The six times the stock rose, it gained 4%.

GameStop shares, which were on track for the lowest close since May 24, have declined 20.9% since the company reported first-quarter results after the June 1 closing bell, while fellow meme stocks AMC Entertainment Holdings Inc.
AMC,
-2.08%

has gained 2.3% and Bed Bath & Beyond Inc.
BBBY,
+9.80%

has lost 11.7% over the same time. The S&P 500 index
SPX,
+0.97%

has lost 4% since June 1.

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