GameStop Stock (NYSE:GME)
GameStop stock (NYSE:GME) is up 7% as of 10:44 a.m. ET on a day when the stock market is just slightly higher generally. However, the S&P 500’s gain of 33 points represents an increase of less than 1%.
Stock in the video game store has risen sharply this morning, but there has been no news to justify the rise, and there are excellent reasons to expect the GameStop stock to decline.
What’s the Reason?
With a short interest ratio of 7.6, GameStop remains a strongly shorted firm, with almost 20% of its outstanding shares sold short (anything over 7 is considered a lot). Last year, GameStop stock became one of the market’s hottest meme stocks due to a heavy short interest that Reddit investors provoked, leading to a significant short squeeze.
While it has seen some recent gains, its current price of roughly $26 per share significantly decreases from its all-time high. GameStop stock is a very volatile stock and may move on to good news, terrible news, or perhaps nothing due to the significant short interest and sustained attention in stock discussion groups.
What’s Next?
Once again, the video game industry is on a downward trend after reaching a peak in the first few months of the epidemic and subsequent lockdowns. On Friday, NPD researcher Mat Piscatella tweeted that September’s expenditure on video game content, hardware, and accessories in the United States was down 4% from the same month a year earlier, amounting to almost $4.1 billion. His research shows that consumer expenditure has dropped by 8% since 2021.
Featured Image- Unsplash @ Michael Förtsch
Author Shariq Khan 
