Janney Capital analyst Tony Wible this morning raised his rating on GameStop (GME) to Buy from Neutral, while maintaining a $27 price target on the shares.
Wible offers six reasons for his more bullish position on the video-game retailer’s shares:
- The launch of new loyalty and digital programs could improve the company’s position.
- Potential for 3D video game catalysts.
- Launch of new hardware.
- Potential for casual game revival through new peripherals like Microsoft’s Project Natal.
- Competitor store closures.
- Cross-sale of downloadable content in stores.
Wible writes that the company also will benefit from easier comps and better title visibility.
“While competitive risks remain and questions about the health of the game cycle linger, publisher comments suggest digital threats are contained for now, expectations have come down over the past year, and GME is taking steps to minimize transitional risks,” he writes.
GME this morning is up 94 cents, to 4.3%, to $22.60.
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