TencentSecurities, March 20 — Economic stimulus checks of 1,400 US dollars a month are entering Americans' bank accounts, butBank of America (Bank of America)It is expected that this financial aid will not stimulate any moreGame Station(GameStop) Speculative trading in stocks.
The Wall Street company's predictive analytics team has been monitoring non-fundamental factors in the game retailer's stock since the gaming site's trading frenzy began in January.
Bank of America screened the number of conversations on Reddit about gaming station trading volume and short interest. The number of conversations was closely related to the increase in the retailer's stock trading volume.
Recently, the bank began monitoring Reddit discussions about economic stimulus checks. The company has come to the conclusion that going forward, it doesn't expect the game station's epic boom to be repeated due to increased cash in consumers' wallets.
Curtis Nagle (Curtis Nagle), a data analysis research analyst at Bank of America, told customers: “Over the past few days, the protectiveness of the stimulus measures seemed to be at its peak, and GME's stock fell.”
“There has been very little recent conversation, including GME and stimulus measures. The trading volume of GME is also steadily declining, and the number of short positions has also dropped drastically,” he added.
In January of this year, the epic “long and short war” of Gaming Station stocks shocked Wall Street and drew attention from emerging retail investors on social media platforms.
Gaming Station's stock soared to $483 per share, then plummeted 90%. The controversy caught the attention of Wall Street and Washington.
Now, as part of a $1.9 trillion stimulus package, millions of Americans will directly receive $1,400 in COVID-19 relief. According to the data, part of the last round of economic stimulus checks in 2020 was used to trade securities, but Bank of America does not expect the game station story to reappear for the most part.
Although the stock rose 98% in March, trading volume was only a small portion of January.
Gaming Station will report earnings on March 23 (Tuesday). Given the disappointing holiday sales results previously announced, Bank of America expects this quarter's performance may still fall short of expectations.
Nagel said, “Given that token sales will be positive, and that the fourth quarter usually accounts for the majority of GME's annual revenue, it's not a very high threshold for GME to achieve 'profitability' this quarter.”
Bank of America said that Gaming Station's stock has been actively driving the company's new development over the past five months, such as withMicrosoftA digital revenue sharing agreement was reached, and an appointment was madeChewyFounder Ryan Cohen (Ryan Cohen) is a member of Gaming Station's board of directors and focuses on Gaming Station's technology and e-commerce transformation.
Nagel added: “Theoretically, these are beneficial to GME, but no details have been provided about the costs, timelines, strategic points, and the impact of the turnaround plan on earnings.” (Triest)