NVDAcontentAD

GameStop Posts First Quarterly Profit in 2 Years, Stock Soars

GME's post-earnings pop is squeezing short sellers

Deputy Editor
Mar 22, 2023 at 3:06 PM
facebook X logo linkedin


GameStop Corp's (NYSE:GME) surprise fourth-quarter results beat sent its shares soaring today, giving other former meme stocks a lift as well. The video game name posted its first profitable quarter in two years, while its gross margin also rose year-over-year. At last glance, GME was up 41% at $24.87, earlier trading as high as $27.00.

GameStop stock was heavily shorted coming into today, with short interest representing 22.1% of the stock's available float. It would take over 12 days to buy back these bearish bets, at GME's average pace of trading.

Today's bull gap has GameStop stock breaking above a confluence of moving averages above the $7 level, including its 120-day trendline, which kept a cap on its early-February rally. GME has also moved into positive territory in 2023, now up 32.5% year-to-date. 

So far today, 354,000 calls and 252,000 puts have been exchanged, which is 10 times the amount typically seen at this point. The weekly 3/24 25-strike call is the most active, followed by the 30-strike call in the same weekly series, with new position being opened at both. 

Options bulls were targeting the security ahead of today as well. GME's 50-day call/put volume ratio of 2.97 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) ranks higher than 98% of readings from the past year. 

Meanwhile, the pair of analysts covering GME lean pessimistic, with one a "hold" and one "strong sell," though the 12-month consensus price target of $13.25 is now a 45% discount to current levels. Wedbush today raised its price target to $6.50 from $5.30, however. 

 

Same-Day Trading Power: +227% YTD and Counting  — Get in for $10!

We're celebrating 44 years of helping traders win, and you can now tap into one of our most explosive services — Dynamite Day Trading Signals — for just $10.

This service was built for one thing: capturing intraday gains with precision. 

Access two highly-vetted options trades each week -  Complete with defined entries, exits, and a clear plan for same-day profits.

👉 Click Here to Learn More and Position Yourself to Take Action When the Next Alert Hits.

 

futupic

 
 
 
 

Follow us on X, Follow us on Twitter