GameStop (GME) CEO Ryan Cohen once again increased his stake in the business by buying $10.6 million worth of GME shares. A regulatory filing showed that Cohen acquired 450,000 Class A common shares. The transactions were executed in two blocks: one of 446,500 shares at a weighted-average price of $23.4753 and an additional 3,500 shares at $23.4499 per share.
This purchase comes after Cohen already made two big-budget buys in GameStop stock. First, he purchased 1 million shares for $20.3 million. Next, he purchased 1.15 million GME shares for $26.4 million.
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Investors follow insider buying closely because it signals management’s confidence in the company’s prospects, and GameStop has been buzzing with insider trading news lately. While the eBay (EBAY) acquisition, a company bigger than GameStop, is at risk, this relentless buying from its CEO indicates that he is pricing something the market isn’t.
About GameStop Stock
GameStop, based in Grapevine, Texas, is a specialty retailer of video games, consumer electronics, gaming accessories, and collectibles. The company operates through a combination of physical stores and e-commerce platforms.
Once the dominant retailer of the mall era, GameStop has reduced its store network while pursuing collectibles and digital initiatives. It gained global attention during the 2021 short squeeze, which made the company a landmark in financial markets. GameStop has a market capitalization of $12.44 billion.
GameStop’s stock is down about 12% over the past 52 weeks, mainly because investors remain concerned about declining core retail sales and the sustainability of its transformation. However, this year, the stock has gained 19%. GME stock had reached a 52-week low of $17.79 on Aug. 20 but is up 35% from that level. It is up 26% over the past month, driven largely by heavy insider buying and renewed optimism about the company’s transformation.
On a forward-adjusted basis, GameStop’s price-to-earnings (non-GAAP) ratio of 13.69x is lower than the industry average of 14.55x.
www.barchart.com GameStop Q2 Profit Surges Despite Revenue Decline as Collectibles Sales Soar
In the second quarter of fiscal 2026 (quarter ended Aug. 1), GameStop reported mixed earnings. However, investors lapped it up, as the stock soared 5.3% intraday on Sept. 9 (the first trading day after the earnings release). The company’s total revenue decreased 18.7% year-over-year (YoY) to $790.20 million. However, this drop was due to the prior-year launch of the Nintendo (NTDOY) Switch 2, planned store closures, and the divestiture of the company’s France operations.
GameStop’s strategic shift toward collectibles is evident in its results. Video game revenue dropped 46.8% annually to $263.20 million, while pre-owned and refurbished revenue decreased 31.7% YoY to $170.70 million. Meanwhile, collectibles revenue rose 56.5% from the prior-year period to $356.30 million. Moreover, video game sales as a percentage of total topline fell from 50.9% to 33.3%, while collectibles' share of total revenue rose from 23.4% to 45.1% over the same period.
Because collectibles are a high-margin business, this sales growth led to higher profit. In fact, operating income of $160.20 million was the highest second-quarter operating income in GameStop's history, reflecting a 141.3% YoY growth. Adjusted EPS climbed from $0.25 to $0.27.
At the end of the second quarter, GameStop held $5.40 billion in total cash, cash equivalents, marketable securities, digital assets, and related receivables. This comprised $5.10 billion in cash, cash equivalents, and marketable securities, down from $8.70 billion a year earlier, and $0.30 billion in digital assets and related receivables. As of Aug. 1, the company held approximately 43.4 million shares of eBay common stock with a fair value of approximately $4.90 billion. It also reduced total long-term debt to approximately $2.80 billion.
Based on these results, GameStop expects to generate adjusted EBITDA above $650 million for the fiscal year ending Jan. 30, 2027, up from its prior outlook of more than $600 million. Adjusted EBITDA for the first six months of fiscal year 2026 was $339.70 million.
Wall Street analysts don't seem to want anything to do with GameStop. GME stock lacks any up-to-date coverage, and the last rating was a “Hold” three months ago with a $13.50 price target that has been significantly surpassed.
On the date of publication, Anushka Dutta did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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