Baird is no longer offering stock ratings for GameStop, the company announced today.
“We are temporarily suspending our rating and price target until the company more clearly articulates new management’s business strategy, which should also allow investors to better assess the company’s intrinsic value and prospects for future free cash flow generation. Our final rating was Neutral. Investors should no longer rely on our prior recommendation or price target when making future investment decisions,” writes senior research analyst Colin Sebastian.
“While we recognize that GameStop is in the early stages of reformulating its retail strategy to reflect the realities of the digital age, including the rapid shift away from physical video game sales and the broader transition to e-commerce, we believe share price volatility is tied more closely to non-fundamental trading, social media influences and other factors that make it difficult, at least in the near term, to make a reasonable stock rating recommendation to institutional investors,” Sebastian adds.
Volatility remains high
GameStop’s stock has seen a lot of volatility in 2021. The retail stock exploded in late January. It surged from just about $17 a share to start the year to a 52-week high of $483. The stock cratered in early February before surging again in March. It has since fluctuated between $120 and $302. As of publication, the current price is $216 per share.