Jefferies’ GameStop’s New $ 175 Price Target Makes Reddit Traders Celebrate

Jefferies' GameStop's New $ 175 Price Target Makes Reddit Traders Celebrate

          GameStop a reçu mercredi un objectif de prix de 175 $ de l'analyste de Jefferies Stephanie Wissink, attisant les flammes sur le forum r / wallstreetbets de Reddit.
          <p>Le nouvel objectif de prix de 175 $ de GameStop de Jefferies a célébré les traders du populaire forum Reddit r / wallstreetbets.

Jefferies analyst Stephanie Wissink raised her price target on the video game retailer’s shares to $ 175 from $ 15 on Wednesday.

Wissink said it was increasing the price target based on GameStop’s shift to e-commerce, “digital and affiliate value streams”.

The massive jump in the price target came after GameStop announced its fourth quarter tax results on Tuesday. The company missed analysts’ estimates for earnings and earnings for the quarter, but analysts at Jefferies saw a silver lining.

In Wissink’s rising scenario, GameStop will be able to shift its “sales mix to collectibles, accessories and digital” while leveraging “the popularity of esports to drive customers to venues. ” in the future.

“With e-com at 30% of sales and already $ 1.5 billion in revenue, growing in triple digits, we see a reasonable base for $ 3 billion in annual revenue in a period of 2 to 3 years, ”said the analyst.

Wissink added that the company will have to “shut down locations that squeeze margins,” but if it is successful in “shedding its retail legacy and transforming into a digital commerce platform (1P + 3P) + advertising + creation of content and curation, its valuation could compete with digital peers with similar business models.

Wissink achieved its new price target after moving its valuation method from a multiple of EBITDA to a multiple of income. Based on 3.4 times sales, a 20% reduction from its peers according to Wissink, GameStop could be worth $ 175 per share.

After Jefferies’ post posted, she quickly toured Reddit’s r / wallstreetbets forum.

Read more: GOLDMAN SACHS: These 40 heavily sold stocks could be the next GameStop if retail traders target them – and the group has almost doubled in the past 3 months already

A post from u / Accomplished_Til184 titled “SUITS JUST RAISED PT FROM $ 15 TO $ 175 HIS TIME FOR TAKEOFFF”, which showed a screenshot of a Bloomberg terminal and the new Jefferies GameStop prize target, received approximately 12,000 positive votes on the forum in just 5 hours.

Reddit traders have been pushing GameStop and other so-called meme stocks higher for months now amid a boom in retail traders.

Now, the investment bank’s new price target and news of Chewy co-founder Ryan Cohen’s move to a more active role as a board member have only fueled the fire. from GameStop.

GameStop shares fell nearly 20% on Wednesday on the first day of trading after the results were released.

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