Why Is Everyone Talking About GameStop Stock?
The video game retailer is shaking things up again to turn things around. GameStop (NYSE: GME) has been struggling to regain its footing amid declining revenue and the broader shift to digital game sales.
Two recent announcements address very different aspects of GameStop as an investment. The company appointed Diana Saadeh-Jajeh as CFO effective July 7, and it will do a 4-for-1 stock split within the next several weeks. GameStop's stock surged during the meme stock frenzy of 2021. Since then, GameStop has been down 62% off its highs. These latest moves are getting everyone to talk about GameStop again. Let's consider what it could mean for investors.
Replacing the CFO seems like an odd move considering that one of the things the company has done exceptionally well during the pandemic is improve its financial condition. As of April 30, GameStop had $1.1 billion in cash and equivalents with just $36 million in long-term debt. Management did a masterful job capitalizing on the meme stock frenzy to sell its shares at inflated prices and use the cash to pay down debt.
Source Fool.com
