Categories Consumer, LATEST, Technology

GameStop plunges 22% after abandoning plans to sell itself

GameStop (GME) on Tuesday said it was abandoning its plans to sell the company, “due to the lack of available financing on terms that would be commercially acceptable to a prospective acquirer.”

The stock tumbled over 22% during pre-market trading following the announcement. The largest brick-and-mortar game retailer is estimated to have lost about $360 million in valuation in today’s sell-off.

The company added that the Board is currently on the lookout for a permanent CEO to run the embattled company.

Photo by Caspar Camille Rubin on Unsplash

GameStop had started exploring the possibility of a sale in June last year. The company had sold its Spring Mobile unit to Prime Communications for over $700 million in November, in order to cut down on debts and reinvest in the core gaming unit. This transaction was completed earlier this month.

GME shares have traded mostly sideways over the past 12 months as investors remained worried over the game retailer’s future in a market that is dominated by online sellers including Amazon (AMZN), besides the rapidly shifting consumer preference towards game streaming.

The stock is currently trading down almost 30% year-over-year.

Four out of six analysts covering the stock have a Hold rating, while one each recommend Buy and Sell ratings.

When the company last reported earnings results in November, the stock had tumbled 12% on weak fiscal 2018 guidance. Meanwhile, earnings and revenues had managed to top street estimates.

 

We’re on Apple News! Follow us to receive the latest stock market, earnings, and financial news at your fingertips

Most Popular

IPO Alert: Here’s what to look for when CaliberCos goes public

The massive slowdown in the IPO market continued in the second half as the challenges posed by high inflation and interest rate hikes weighed on investor confidence. Meanwhile, there is

CarMax (KMX) Stock: Does the current dip offer a buying opportunity?

The automotive sector is one of the worst affected by the combination of high inflation and rising interest rates. Consumers have become more cautious and are prioritizing their purchases with

Ultimax Digital gears up for $10mln IPO. Here’s all you need to know

The IPO market has witnessed muted activity this year, and things don’t seem to have improved in the second half. The upcoming public listing of video game technology firm Ultimax

Add Comment
Loading...
Cancel
Viewing Highlight
Loading...
Highlight
Close
Top