GameStop Corp.(NYSE:GME) shares are falling Friday as investors take profits following fresh 52-week highs earlier this week.
Yorkville Ives analyst Dan Ives maintained an Outperform rating on GameStop and a $32 price target in a Thursday research note. He highlighted the company’s shift from traditional video-game retail toward collectibles, which account for about 45% of sales.
• GameStop shares are sliding. Why is GME stock falling?
Trading Card Intake Points
Ives writes that GameStop’s advantage in trading cards comes from its national store network, its trade-in culture and its enthusiast customers. The PSA partnership adds card grading, which the note says could make stores intake points for PSA. PSA graded more than 19 million cards in 2025, according to the note.
Buyback Program Drives Margin
Ives says GameStop does not need to profit on card packs themselves. The company discloses that a pack’s estimated card value is substantially equivalent to its price. Instant Buyback repurchases cards at 90% of fair market value less a 6% selling fee, a spread of roughly 15%, per the note.
eBay Stake Viewed as More Than a Failed Bid
eBay Inc.(NASDAQ:EBAY) rejected GameStop’s roughly $56 billion cash-and-stock proposal in May. GameStop then built a stake of about 9.8%, valued at $4.9 billion at the end of the second quarter of fiscal 2026. The note says investors read this too narrowly as a failed takeover and see strategic logic in an acquisition or a commercial arrangement.
Ives values the core business at about 16.4 times fiscal 2027 estimated adjusted EBITDA of $708 million. EBITDA is a measure of operating profit before interest, taxes, depreciation and amortization. The peer median is about 13.8 times. The valuation adds the eBay stake, $5.2 billion in cash, securities and bitcoin and subtracts $2.8 billion in debt.
Risks Listed in the Note
The risks include collectibles demand proving cyclical, a continued decline in legacy video-game sales, which are still a third of sales, and concentration in the eBay stake, which is roughly a quarter of equity value. The note lists four more risks, including capital allocation and dilution from convertible notes.
Ives calls GameStop “an under-the-radar story in the early stages of its transformation under,” GameStop CEO Ryan Cohen.
GME Stock Price Activity: GameStop shares were down 3.85% at $26.94 at the time of publication on Friday
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