Shares of GameStop (NYSE:GME) are running 6.6% higher in morning trading Monday on no news particular to the video game retailer, though its stock remains one of the most mentioned tickers in internet stock chat rooms.
GameStop was, of course, one of the original so-called meme stocks that elevated the stock’s market value earlier this year, and though it has pulled back from those early highs, small retail investors remain committed to its turnaround.
Chairman Ryan Cohen has a vision of GameStop turning into an e-commerce giant for the video game industry. The odds are certainly stacked against the company, but since it remains a top-of-mind brand with gamers, there’s a genuine chance it could succeed.
During the early days of the pandemic, when everyone was forced to lock down and sought out video games as entertainment to while away the hours, traffic to GameStop’s website soared well over 1,000%.
Many believe GameStop is something of a cigar-butt business with only a few puffs left on it before the transition of the video game industry to digital and downloads is complete, rendering its portfolio of physical retail stores obsolete. Nevertheless, that abrupt traffic rush shows that lots of gamers still think of GameStop as the place to go for video games and gear.
It’s been a while since GameStop has enjoyed a nice up day like the one it is having today. Shares have been slowly but surely sliding, and stock prices are down almost 10% over the past month. However, the fact that the video game retailer continues to be on the lips of the Reddit crowd even this long into the whole meme stock trading frenzy indicates the video game stock’s popularity has not faded.
This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.
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