Video game retailer GameStop (NYSE: GME) will be reporting earnings this Tuesday after market close. Here’s what you need to know.
GameStop missed analysts’ revenue expectations by 2.9% last quarter, reporting revenues of $732.4 million, down 16.9% year on year. It was a strong quarter for the company, with a beat of analysts’ EPS estimates and a solid beat of analysts’ gross margin estimates.
Is GameStop a buy or sell going into earnings? Read our full analysis here, it’s free.
This quarter, analysts are expecting GameStop’s revenue to grow 3.1% year on year to $823.2 million, a reversal from the 31.4% decrease it recorded in the same quarter last year. Adjusted earnings are expected to come in at $0.16 per share.
The majority of analysts covering the company have reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings.
Looking at GameStop’s peers in the specialty retail segment, some have already reported their Q2 results, giving us a hint as to what we can expect. Best Buy delivered year-on-year revenue growth of 1.6%, beating analysts’ expectations by 2.3%, and Ulta reported revenues up 9.3%, topping estimates by 4.2%. Best Buy traded down 2.4% following the results while Ulta was also down 7.1%.
Read our full analysis of Best Buy’s results here and Ulta’s results here.
There has been positive sentiment among investors in the specialty retail segment, with share prices up 9.3% on average over the last month. GameStop is up 1.2% during the same time and is heading into earnings with an average analyst price target of $13.50 (compared to the current share price of $22.69).
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