GameStop defended after share meltdown

|About: GameStop Corp. (GME)|By:, SA News Editor

GameStop (GME +0.7%) is defended at Sterne Agee with a reiterated Buy rating on the firm's belief that new consoles will reach the 50M level by 2015 to support the company's business model.

The dismantling of shares of GameStop yesterday was based on the premise that although Xbox One and PlayStation 4 gaming consoles sold well, consumers are buying fewer older-model games than anticipated in a trend that cuts deeply into profit margins.

Sterne takes the long view that the new console cycle still sets up GameStop well as gamers reload and sees the sell-off as bringing GME's valuation back to an attractive entry point.

The investment firm did reign in its lofty price target a bit, reducing it to $52 from $58.