GameStop Stock Swings Higher on CEO Buzz

Jefferies slashed its GME price target to $12

Digital Content Manager
Mar 22, 2019 at 9:50 AM
facebook twitter linkedin

The shares of GameStop Corp (NYSE:GME) are up 0.9% at $10.64, after the video game retailer appointed George Sherman as its new CEO. Comments and a subsequent price-target cut from Jefferies are keeping a lid on the gains, though. The analyst slashed its GME target price to $12 from $13, noting the company's current lack of vision. 

GameStop is no stranger to negative analyst attention. Currently, only one analyst thinks GME is a "strong buy," while four "hold" ratings are on the table, and two "sell" or worse ratings. What's more, the consensus 12-month target price of $11.91 is a tame 11.7% premium to current levels. 

The security has been trading in a channel of lower highs and lows since a dramatic bear gap in late January caused the equity to shave off more than 27% in one day. GME found a brief floor in the $11 area before its 30-day moving average forced the shares lower. The security just touched a near 14-year low of $10.35 yesterday, but ended the day in the black. 

The stock's recent behavior on the charts has bearish bettors cheering. Short interest rose 7.1% in the last reporting period, and now represents 35.4% of GME's available float, or over two weeks of trading at its average daily volume. Plus, short-term puts have rarely been more popular, per GameStop's Schaeffer's put/call open interest ratio (SOIR) of 1.67, which sits in the 93rd percentile of its annual range. 





These investors are using the market's volatility to their advantage and scoring triple-digit gains on many of their trades.

Even in today's sideways bear market, this trading strategy has continued to provide consistency and profitability to a small group of investors. By using this approach, these traders are removing directional risk and still hitting triple-digit returns. If you want access to this strategy, and lower risk with higher returns sounds good to you, then don't wait another minute.

Join us now to receive our next trades the moment they come out!


Common mistakes options traders make


Special Offers from Schaeffer's Trading Partners