GameStop's Stock Looks Like A Value Trap

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About: GameStop Corp. (GME)
by: Magnus Investments
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Magnus Investments
Long only, value, special situations, growth at reasonable price
Summary

GameStop announced a turnaround strategy called GameStop Reboot.

Near-term, cost optimization work will support profit improvement, but finding viable alternative revenue sources is key.

Capital redeployment to transformation initiatives increases risk.

A key challenge is facing structural headwinds with sustainable growth murky.

Depressed share price valuations will likely continue.

Investment Overview

Amid a challenging video game retail landscape, GameStop Corp. (GME) unveiled a plan called "GameStop Reboot" focused on cost reduction, optimization of current business, and development of new revenue