How Important Is The Retail & Technology Brands Segment For GameStop?

-16.65%
Downside
13.91
Market
11.59
Trefis
GME: GameStop logo
GME
GameStop

GameStop‘s (NYSE:GME) retail & technology brands business contributes almost 40% to the company’s value as per our estimates, despite accounting for just 26% of its revenues. This is because the retail & technology brands’ segment is a more profitable business with gross margins at around 44%, as opposed to GameStop’s remaining segments, where gross margins are lower at 27%. Additionally, revenues for the retail & technology brands side of the business are expected to rise at CAGR (compound annual growth rate) of 6.3% through to 2021, while revenues from other segments are expected to shrink at a CAGR of 0.4%. The company’s retail & technology brand business is expected to grow strongly on the back of rapid acquisition and expansion of technology brand stores.

GME retail and technology brands part one

Second correction in value

GME retail and technology brands part three

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Notes:

1) The purpose of these analyses is to help readers focus on a few important things. We hope such lean communication sparks thinking, and encourages readers to comment and ask questions on the comment section, or email content@trefis.com
2) Figures mentioned are approximate values to help our readers remember the key concepts more intuitively. For precise figures, please refer to our complete analysis for GameStop
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