September 24, 2017

NYSE: GME

GAMESTOP CORP
BUY HOLD SELL

HOLD
RATING SINCE 09/14/2016
A+ A A- B+ B B- C+ C C- D+ D D- E+ E E- F
Annual Dividend Rate Annual Dividend Yield Beta Market Capitalization 52-Week Range Price as of 9/21/2017
$1.52 7.64% 1.21 $2.0 Billion $18.47-$28.58 $19.89

Sector: Consumer Goods & Svcs Sub-Industry: Computer & Electronics Retail Source: S&P
Weekly Price: (US$) SMA (50) SMA (100) 1 Year 2 Years
GME BUSINESS DESCRIPTION
GameStop Corp. operates as an omnichannel video 50
game retailer.
45
STOCK PERFORMANCE (%) 40
3 Mo. 1 Yr. 3 Yr (Ann)
Price Change -2.79 -29.30 -22.89 35

GROWTH (%) 30
Last Qtr 12 Mo. 3 Yr CAGR
25
Revenues 3.41 -4.45 -2.81
Net Income -20.44 -14.27 -3.72 20
EPS -18.52 -12.14 0.50
15
RETURN ON EQUITY (%) Rating History
GME Ind Avg S&P 500 BUY HOLD HOLD
Q2 2017 14.73 127.18 13.16
Volume in Millions
Q2 2016 18.47 59.89 11.83 40
Q2 2015 20.31 42.45 13.71
20
P/E COMPARISON
0
2016 2017
COMPUSTAT for Price and Volume, TheStreet Ratings, Inc. for Rating History

RECOMMENDATION
We rate GAMESTOP CORP (GME) a HOLD. The primary factors that have impacted our rating are mixed -
some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a
positive or negative performance for this stock relative to most other stocks. The company's strengths can
be seen in multiple areas, such as its revenue growth, attractive valuation levels and good cash flow from
5.97 20.91 24.93 operations. However, as a counter to these strengths, we also find weaknesses including feeble growth in
GME Ind Avg S&P 500 the company's earnings per share, deteriorating net income and disappointing return on equity.

HIGHLIGHTS
EPS ANALYSIS ($) GME's revenue growth trails the industry average of 15.8%. Since the same quarter one year prior, revenues
slightly increased by 3.4%. This growth in revenue does not appear to have trickled down to the company's
bottom line, displayed by a decline in earnings per share.

The current debt-to-equity ratio, 0.35, is low and is below the industry average, implying that there has been
Q1 0.68

Q1 0.63

successful management of debt levels. Even though the company has a strong debt-to-equity ratio, the quick
Q1 0.58
Q3 0.53

Q3 0.49

ratio of 0.33 is very weak and demonstrates a lack of ability to pay short-term obligations.
Q2 0.27
Q2 0.24

Q2 0.22
Q4 2.36

Q4 2.04

GAMESTOP CORP's earnings per share declined by 18.5% in the most recent quarter compared to the same
quarter a year ago. Earnings per share have declined over the last two years. We anticipate that this should
2015 2016 2017 continue in the coming year. During the past fiscal year, GAMESTOP CORP reported lower earnings of $3.43
NA = not available NM = not meaningful
versus $3.81 in the prior year. For the next year, the market is expecting a contraction of 3.4% in earnings
($3.32 versus $3.43).
1 Compustat fiscal year convention is used for all fundamental
data items.
The company, on the basis of change in net income from the same quarter one year ago, has significantly
underperformed when compared to that of the S&P 500 and the Specialty Retail industry. The net income has
decreased by 20.4% when compared to the same quarter one year ago, dropping from $27.90 million to $22.20
million.

This report is for information purposes only and should not be considered a solicitation to buy or sell any security. Neither TheStreet Ratings nor any other party guarantees its accuracy Report Date: September 24, 2017 PAGE 1
or makes warranties regarding results from its usage. Redistribution is prohibited without the express written consent of TheStreet Ratings. Copyright(c) 2006-2016. All rights reserved.
 September 24, 2017
NYSE: GME

GAMESTOP CORP
Sector: Consumer Goods & Svcs Computer & Electronics Retail Source: S&P
Annual Dividend Rate Annual Dividend Yield Beta Market Capitalization 52-Week Range Price as of 9/21/2017
$1.52 7.64% 1.21 $2.0 Billion $18.47-$28.58 $19.89

PEER GROUP ANALYSIS INDUSTRY ANALYSIS

REVENUE GROWTH AND EBITDA MARGIN*
The specialty retail industry includes very well-known home improvement, apparel, automotive, and other
narrow-focus stores such as Home Depot (HD), TJX Companies (TJX), Lowes Companies (LOW), Gap (GPS),
2%

AEO
AN BBY Bed Bath & Beyond (BBBY), Ross Stores (ROST), OReilly Automotive (ORLY), CarMax (KMX), and
AAN
FA

Build-A-Bear Workshop (BBW).

VO
RA

ARCI
BL

The variety of product focuses targeted by specialty retail companies is very diverse. These include but are
E

not limited to home improvement goods, pharmaceutical & beauty, shoes, electronics, and office supplies.
GME ANF Also included are stores narrowly focused on music, books, wine, games, rentals, vitamins, lumber, sporting
goods, toys, jewelry, and fashion apparel for men, women, and teddy bears.
BKS CONN
Revenue Growth (TTM)

Some of the larger specialty retail companies also profit from the extension of credit to their customers with
branded credit cards.
UN
FA

Companies in this industry are judged based on the metric of same-store sales, a measurement that shows if
VO
-14%

stores open for more than one year are increasing top line revenue or shrinking.
RA

RCII
B
LE

-60%BEBE 60%
PEER GROUP: Specialty Retail
EBITDA Margin (TTM)
Recent Market Price/ Net Sales Net Income
Companies with higher EBITDA margins and Ticker Company Name Price ($) Cap ($M) Earnings TTM ($M) TTM ($M)
revenue growth rates are outperforming companies
GME GAMESTOP CORP 19.89 2,015 5.97 8,738.10 340.70
with lower EBITDA margins and revenue growth
rates. Companies for this scatter plot have a market ANF ABERCROMBIE & FITCH 13.97 951 NM 3,298.52 -20.52
capitalization between $7.5 Million and $16.1 Billion. ARCI APPLIANCE RECYCLING CTR AMER 1.13 8 1.38 102.51 5.37
Companies with NA or NM values do not appear. CONN CONN'S INC 22.10 690 NM 1,531.24 -2.20
*EBITDA Earnings Before Interest, Taxes, Depreciation and RCII RENT-A-CENTER INC 10.87 579 NM 2,797.60 -155.77
Amortization.
BKS BARNES & NOBLE INC 7.00 508 21.21 3,833.99 25.66
REVENUE GROWTH AND EARNINGS YIELD AN AUTONATION INC 46.94 4,715 11.68 21,466.70 408.40
BEBE BEBE STORES INC 5.08 41 NM 349.81 -39.73
2%

AEO BBY
AN AAN AARON'S INC 38.83 2,746 19.91 3,224.13 140.73
AAN
FA

AEO AMERN EAGLE OUTFITTERS INC 13.67 2,420 14.09 3,644.25 176.85
VO
RA

ARCI BBY BEST BUY CO INC 53.95 16,141 14.27 39,895.00 1,198.00
BL
E

The peer group comparison is based on Major Computer & Electronics Retail companies of comparable size.

ANF GME

CONN BKS
Revenue Growth (TTM)
UN
FA
VO
-14%

RA

RCII
B
LE

BEBE
-100% 75%
Earnings Yield (TTM)
Companies that exhibit both a high earnings yield
and high revenue growth are generally more
attractive than companies with low revenue growth
and low earnings yield. Companies for this scatter
plot have revenue growth rates between -13.2% and
1.3%. Companies with NA or NM values do not
appear.

This report is for information purposes only and should not be considered a solicitation to buy or sell any security. Neither TheStreet Ratings nor any other party guarantees its accuracy Report Date: September 24, 2017 PAGE 2
or makes warranties regarding results from its usage. Redistribution is prohibited without the express written consent of TheStreet Ratings. Copyright(c) 2006-2016. All rights reserved.
 September 24, 2017
NYSE: GME

GAMESTOP CORP
Sector: Consumer Goods & Svcs Computer & Electronics Retail Source: S&P
Annual Dividend Rate Annual Dividend Yield Beta Market Capitalization 52-Week Range Price as of 9/21/2017
$1.52 7.64% 1.21 $2.0 Billion $18.47-$28.58 $19.89

COMPANY DESCRIPTION STOCK-AT-A-GLANCE

GameStop Corp. operates as an omnichannel video game Below is a summary of the major fundamental and technical factors we consider when determining our
retailer. It sells new and pre-owned video game overall recommendation of GME shares. It is provided in order to give you a deeper understanding of our
hardware; video game software; pre-owned and value rating methodology as well as to paint a more complete picture of a stock's strengths and weaknesses. It is
video game products; video game accessories, such as important to note, however, that these factors only tell part of the story. To gain an even more comprehensive
controllers, gaming headsets, virtual reality products, understanding of our stance on the stock, these factors must be assessed in combination with the stocks
memory cards, and other add-ons; and digital products, valuation. Please refer to our Valuation section on page 5 for further information.
including downloadable content, network points cards,
prepaid digital and subscription cards, and digitally FACTOR SCORE
downloadable software. The company also sells mobile
and consumer electronics, including wireless products Growth out of 5 stars 1.5
and services, and accessories, as well as new and Measures the growth of both the company's income statement and weak strong
pre-owned smart phones; personal computer (PC) cash flow. On this factor, GME has a growth score better than 20% of
entertainment software in various genres, including the stocks we rate.
sports, action, strategy, adventure/role playing, and
simulation; and strategy guides, magazines, and
interactive game figures. In addition, it offers collectibles
Total Return out of 5 stars 1.0
that include licensed merchandise related to the video Measures the historical price movement of the stock. The stock weak strong
game, television, and movie industries, as well as pop performance of this company has beaten 10% of the companies we
culture themes; and operates electronic commerce cover.
Websites under the GameStop, EB Games, Micromania,
and ThinkGeek brand names. Further, the company Efficiency out of 5 stars 4.5
operates kongregate.com, a browser-based game site; Measures the strength and historic growth of a company's return on weak strong
Game Informer magazine, a print and digital video game invested capital. The company has generated more income per dollar of
publication; iOS and Android mobile applications; Simply capital than 80% of the companies we review.
Mac, a certified Apple consumer electronic products
reseller, as well as offers certified training, warranty,
and repair services; and Spring Mobile, an authorized
Price volatility out of 5 stars 1.5
AT&T reseller operating AT&T branded wireless retail Measures the volatility of the company's stock price historically. The weak strong
stores, as well as pre-paid wireless stores under the stock is less volatile than 20% of the stocks we monitor.
Cricket Wireless name that offers prepaid services,
wireless devices, and accessories. As of January 28, Solvency out of 5 stars 4.0
2017, it operated approximately 7,535 stores in the Measures the solvency of the company based on several ratios. The weak strong
United States, Australia, Canada, and Europe. GameStop company is more solvent than 70% of the companies we analyze.
Corp. primarily offers its products through stores under
the GameStop, EB Games, and Micromania names. The Income out of 5 stars 5.0
company was formerly known as GSC Holdings Corp.
Measures dividend yield and payouts to shareholders. The company's weak strong
GameStop Corp. was founded in 1994 and is based in
dividend is higher than 90% of the companies we track.
Grapevine, Texas.

GAMESTOP CORP THESTREET RATINGS RESEARCH METHODOLOGY

625 Westport Parkway
Grapevine, TX 76051 TheStreet Ratings' stock model projects a stock's total return potential over a 12-month period including both
USA price appreciation and dividends. Our Buy, Hold or Sell ratings designate how we expect these stocks to
Phone: 817-424-2000 perform against a general benchmark of the equities market and interest rates. While our model is
http://www.gamestop.com quantitative, it utilizes both subjective and objective elements. For instance, subjective elements include
expected equities market returns, future interest rates, implied industry outlook and forecasted company
earnings. Objective elements include volatility of past operating revenues, financial strength, and company
cash flows.

Our model gauges the relationship between risk and reward in several ways, including: the pricing drawdown
as compared to potential profit volatility, i.e.how much one is willing to risk in order to earn profits; the level of
acceptable volatility for highly performing stocks; the current valuation as compared to projected earnings
growth; and the financial strength of the underlying company as compared to its stock's valuation as
compared to projected earnings growth; and the financial strength of the underlying company as compared
to its stock's performance. These and many more derived observations are then combined, ranked, weighted,
and scenario-tested to create a more complete analysis. The result is a systematic and disciplined method of
selecting stocks.

This report is for information purposes only and should not be considered a solicitation to buy or sell any security. Neither TheStreet Ratings nor any other party guarantees its accuracy Report Date: September 24, 2017 PAGE 3
or makes warranties regarding results from its usage. Redistribution is prohibited without the express written consent of TheStreet Ratings. Copyright(c) 2006-2016. All rights reserved.
 September 24, 2017
NYSE: GME

GAMESTOP CORP
Sector: Consumer Goods & Svcs Computer & Electronics Retail Source: S&P
Annual Dividend Rate Annual Dividend Yield Beta Market Capitalization 52-Week Range Price as of 9/21/2017
$1.52 7.64% 1.21 $2.0 Billion $18.47-$28.58 $19.89

Consensus EPS Estimates ($) FINANCIAL ANALYSIS

IBES consensus estimates are provided by Thomson Financial
GAMESTOP CORP's gross profit margin for the second quarter of its fiscal year 2017 is essentially unchanged
when compared to the same period a year ago. Even though sales increased, the net income has decreased,
representing a decrease to the bottom line. GAMESTOP CORP has very weak liquidity. Currently, the Quick
Ratio is 0.33 which clearly shows a lack of ability to cover short-term cash needs. The company's liquidity has
decreased from the same period last year.

During the same period, stockholders' equity ("net worth") has increased by 7.47% from the same quarter last
0.41 year. The key liquidity measurements indicate that the company is in a position in which financial difficulties
3.32 E 3.30 E could develop in the near future.
Q3 FY17 2018(E) 2019(E)
STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the
next 12-months. To learn more visit www.TheStreetRatings.com.
INCOME STATEMENT
Q2 FY17 Q2 FY16
Net Sales ($mil) 1,687.60 1,631.80
EBITDA ($mil) 74.20 99.70
EBIT ($mil) 36.30 58.30
Net Income ($mil) 22.20 27.90

BALANCE SHEET
Q2 FY17 Q2 FY16
Cash & Equiv. ($mil) 262.10 289.50
Total Assets ($mil) 4,609.80 4,133.60
Total Debt ($mil) 816.40 813.50
Equity ($mil) 2,311.70 2,151.00

PROFITABILITY
Q2 FY17 Q2 FY16
Gross Profit Margin 36.97% 37.88%
EBITDA Margin 4.39% 6.10%
Operating Margin 2.15% 3.57%
Sales Turnover 1.90 2.21
Return on Assets 7.39% 9.61%
Return on Equity 14.73% 18.47%

DEBT
Q2 FY17 Q2 FY16
Current Ratio 1.34 1.59
Debt/Capital 0.26 0.27
Interest Expense 14.40 13.90
Interest Coverage 2.52 4.19

SHARE DATA
Q2 FY17 Q2 FY16
Shares outstanding (mil) 101 104
Div / share 0.38 0.37
EPS 0.22 0.27
Book value / share 22.82 20.68
Institutional Own % NA NA
Avg Daily Volume 2,369,310 3,004,987
2 Sum of quarterly figures may not match annual estimates due to
use of median consensus estimates.

This report is for information purposes only and should not be considered a solicitation to buy or sell any security. Neither TheStreet Ratings nor any other party guarantees its accuracy Report Date: September 24, 2017 PAGE 4
or makes warranties regarding results from its usage. Redistribution is prohibited without the express written consent of TheStreet Ratings. Copyright(c) 2006-2016. All rights reserved.
 September 24, 2017
NYSE: GME

GAMESTOP CORP
Sector: Consumer Goods & Svcs Computer & Electronics Retail Source: S&P
Annual Dividend Rate Annual Dividend Yield Beta Market Capitalization 52-Week Range Price as of 9/21/2017
$1.52 7.64% 1.21 $2.0 Billion $18.47-$28.58 $19.89

RATINGS HISTORY VALUATION

Our rating for GAMESTOP CORP has not changed HOLD. GAMESTOP CORP's P/E ratio indicates a significant discount compared to an average of 20.91 for the
since 9/14/2016. As of 9/21/2017, the stock was Specialty Retail industry and a significant discount compared to the S&P 500 average of 24.93. For additional
trading at a price of $19.89 which is 30.4% below its comparison, its price-to-book ratio of 0.87 indicates a significant discount versus the S&P 500 average of 3.11
52-week high of $28.58 and 7.7% above its 52-week and a significant discount versus the industry average of 24.51. The price-to-sales ratio is well below both the
low of $18.47. S&P 500 average and the industry average, indicating a discount. Upon assessment of these and other key
valuation criteria, GAMESTOP CORP proves to trade at a discount to investment alternatives within the
2 Year Chart industry.
$50
BUY: $41.72

HOLD: $28.45

HOLD: $27.03

$40 Price/Earnings 1 2 3 4 5 Price/CashFlow 1 2 3 4 5

premium discount premium discount
$30 GME 5.97 Peers 20.91 GME 3.09 Peers 13.40
Discount. A lower P/E ratio than its peers can Discount. The P/CF ratio, a stocks price divided by
$20 signify a less expensive stock or lower growth the company's cash flow from operations, is useful
expectations. for comparing companies with different capital
2015 2016 GME is trading at a significant discount to its peers. requirements or financing structures.
GME is trading at a significant discount to its peers.

MOST RECENT RATINGS CHANGES

Price/Projected Earnings 1 2 3 4 5 Price to Earnings/Growth 1 2 3 4 5
premium discount premium discount
Date Price Action From To GME 6.03 Peers 18.93 GME NM Peers 1.70
9/14/16 $27.03 Downgrade Buy Hold Discount. A lower price-to-projected earnings ratio Neutral. The PEG ratio is the stocks P/E divided by
8/24/16 $31.71 Upgrade Hold Buy than its peers can signify a less expensive stock or the consensus estimate of long-term earnings
1/7/16 $28.45 Downgrade Buy Hold lower future growth expectations. growth. Faster growth can justify higher price
9/21/15 $41.72 No Change Buy Buy GME is trading at a significant discount to its peers. multiples.
GME's negative PEG ratio makes this valuation
Price reflects the closing price as of the date listed, if available
measure meaningless.

RATINGS DEFINITIONS & Price/Book 1 2 3 4 5 Earnings Growth 1 2 3 4 5

premium discount lower higher
DISTRIBUTION OF THESTREET RATINGS
GME 0.87 Peers 24.51 GME -12.14 Peers 12.02
(as of 9/21/2017)
Discount. A lower price-to-book ratio makes a Lower. Elevated earnings growth rates can lead to
stock more attractive to investors seeking stocks capital appreciation and justify higher
43.27% Buy - We believe that this stock has the
opportunity to appreciate and produce a total return of with lower market values per dollar of equity on the price-to-earnings ratios.
more than 10% over the next 12 months. balance sheet. However, GME is expected to significantly trail its
GME is trading at a significant discount to its peers. peers on the basis of its earnings growth rate.
31.09% Hold - We do not believe this stock offers Price/Sales 1 2 3 4 5 Sales Growth 1 2 3 4 5
conclusive evidence to warrant the purchase or sale of premium discount lower higher
shares at this time and that its likelihood of positive total GME 0.23 Peers 1.44 GME -4.45 Peers 5.21
return is roughly in balance with the risk of loss. Discount. In the absence of P/E and P/B multiples, Lower. A sales growth rate that trails the industry
the price-to-sales ratio can display the value implies that a company is losing market share.
25.64% Sell - We believe that this stock is likely to investors are placing on each dollar of sales. GME significantly trails its peers on the basis of
decline by more than 10% over the next 12 months, with
GME is trading at a significant discount to its sales growth
the risk involved too great to compensate for any
industry on this measurement.
possible returns.
DISCLAIMER:
TheStreet Ratings
The opinions and information contained herein have been obtained or derived from sources believed to be reliable, but
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This report is for information purposes only and should not be considered a solicitation to buy or sell any security. Neither TheStreet Ratings nor any other party guarantees its accuracy Report Date: September 24, 2017 PAGE 5
or makes warranties regarding results from its usage. Redistribution is prohibited without the express written consent of TheStreet Ratings. Copyright(c) 2006-2016. All rights reserved.