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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Paul Senior who wrote (56473)	12/30/2015 5:22:36 PM
From: deeno	Respond to of 78753

Hope your right on GME. Bought some mid to low thirties month or so ago. Seems like its a binary event. A couple well respected analysits versus the world. I expect at minimum a rising dividend rate. If the naysayers are right we should see an ugly Xmas and continued declining revenue. That would kill my expectations on rising cash flow. If the niche remains there should be a very nice rally in the next 12 months. Unfortunately I don't see much downside protection, so this play ain't for the faint of heart.

To: Paul Senior who wrote (56473)	8/25/2017 2:30:43 PM
From: Paul Senior	Respond to of 78753

GME (Gamestop). Beat up for several good reasons: Preowned game sales are down, and for new games, why go to a retail store when you can download them? Company is trying to diversify with AT&T deal and has hopes for business with new iPhone. But again why not just buy Apple apps at Apple store? Or maybe get most of what GME sells on AMZN? Otoh, there may be some positives for a value investor. From Motley Fool, fool.com (CEO)Raines and his team see several reasons for optimism about the second half of the fiscal year. The Nintendo Switch should continue selling well, and customer traffic will likely spike around the launch of Microsoft's new Xbox console, too. There's also a strong slate of major video game releases ahead, including tent-pole launches from Activision Blizzard. At the same time, a major upgrade cycle for the latest iPhone should lift results at GameStop's consumer technology segment.These tailwinds have management feeling confident that the company will hit the high end of its full-year sales growth guidance, which would mark flat comparable-store sales following last year's 11% slump. The company still believes it will generate between $3.10 and $3.40 per share of earnings for the year, translating into somewhere between a flat result and a 9% profit decline. In either case, GameStop's generous dividend payment should be well covered, with thepayout ratio remaining below 50%. Revenue seems to holding up (but really not growing over past few years). Dividend's $1.52 on a $19 stock today = 8% Since dividend's been instituted in 2013, they've increased it every year. Roe has been pretty good, holding around 15% past few years. Shares outstanding have dropped from 168M to 104 over past eight years (Morningstar data) If company actually does make $3/sh, that'd be about p/e of 6 on today's $19 stock price. Company has relatively low p/sales ratio and is at a multiyear low for price/stated bv. (Granted stated bv may not mean much with retail stores and their mysterious-to-me possible off-balance sheet liabilities.) ======================================== I hold a few losing shares, and I've upped my shares today on the stock's drop. I guess for most people the continuing issue of the viability of the company's business model and/or lack of investors' confidence of GME's changing business initiatives (changing business model), would stop them from considering the stock. For me, the stock seems at a point where I can risk a small amount as a holding withing a diversified stock portfolio.