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It’s hard to compare the soaring GameStop (NYSE: GME) stock to everything that’s happened in the markets before. “Unparalleled” is an overused word, but it really applies to GME stocks >

I usually try to provide an update on the most recent price movement of a stock, but when it comes to GME stocks, there is no telling where the price will be at the time of reading

This is how volatile GME stock has been lately, the stock price could double or fall by a third on a given day.This magnitude of price movement sometimes occurs in low float penny stocks, but that’s not what we’re up to here

Is this some form of market manipulation or a real grassroots movement? And have share prices and company fundamentals been separated for good? Wait a moment! Let’s see if we can get to the bottom of GME stock

There’s one major complaint about the rise in GME stock price, in particular, it’s the idea that the company isn’t doing really well

That’s not just my opinion, as GameStop CEO George Sherman freely admitted that the company’s latest reported tax results “were in line with… subdued expectations, reflecting a seven-year console’s operation over the past few months on a cycle and a global pandemic who put pressure on sales and earnings ”

I’m not implying that GameStop’s fiscal third quarter was bad.But the numbers don’t lie. Worryingly, GameStop’s quarterly net sales barely exceeded $ 1 billion, down 2% from the year-ago quarter

The company also reported that comparable store sales were down 246%. In addition, GameStop recorded a net loss of $ 188 million, or 29 cents per diluted share

So, if we look at GameStop through the lens of a fundamental value investor, it would be terribly difficult to justify a buy-and-hold strategy

On the flip side, Reddit users who have benefited from the GME stock buying frenzy probably don’t care what Warren Buffett thinks of it

You’re probably more than happy to “leave it to the man” and raise the stock price as a social statement

No doubt it feels like a win not only making money but also taking control of the markets away from powerful short sellers like Citron and Melvin Capital

And it must be nice to get confirmation from none other than Elon Musk, CEO of Tesla (NASDAQ: TSLA), who tweeted “Gamestonk !!” including a link to the Reddit group r / WallStreetBets

Not so long ago, some popular brokers restricted certain promotions with GME stock. For example, Robinhood has limited the number of stocks users can purchase

These kind of restrictions must be quite frustrating for people hearing about sky high target prices on GME stock, you’ll hear all kinds of numbers tossed around, even up to 5$ 000

To find out how best to approach these moon shot predictions, I’ll reach out to InvestorPlace Sarah Smith’s exceptional contributor takes in price target escalation: “Take it all with a grain of salt. These bullish posts identify themselves as some sort of fiction, including that Caveats that they are not real investment advice ”

I couldn’t have said it better myself (by the way, nothing I write about is investment advice)

If you were to join the Reddit Army today and buy GME stock, I would consider this a lottery ticket, the stock price could go up to $ 5$ 000 rise, or it could go straight back to $ 5 where it was a year ago

If you have cash burning a hole in your pocket, feel free to buy a GME stock or two. For all we know, the stock price could go a lot higher

Or it could fall back on Earth. This is a definite possibility Please exercise moderation.Finally, the Reddit Army is not offering compensation for financial loss in GME stock

At the time of this writing, David Moadel held (neither directly nor indirectly) positions in the securities mentioned in this article

David Moadel has provided compelling content on behalf of Crush the Street, Market Realist, TalkMarkets, Finom Group, Benzinga and (of course) InvestorPlace – and occasionally crossed the linecom He also acts as chief analyst and market researcher for Portfolio Wealth Global and is hosting of the popular financial YouTube channel Looking at the Markets

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Source: https://investorplace.com/2021/02/buy-a-share-or-two-gme-stock-but-no-more/