GameStop Just Beat Earnings Estimates. Should You Bet on a Turnaround in GME Stock?

GameStop (GME) is back in the news with a surprise profitable third fiscal quarter. The company reported a surprise EPS of $0.24, which beat estimates by $0.04, and showed a dramatic improvement from a year ago when it incurred an operating loss to a surprise profit of $41.3 million. However, GameStop's stock dropped in after-market hours despite beating estimates, as it reported a revenue of $821 million, which missed estimates by a huge margin of 4.5% from a year ago.

The findings come as a welcome relief, though, in a situation where the overall retail industry also has budget cuts to make. GME stock, on the other hand, remains very volatile. This needs mention, since it currently trades far from the 52-week high of $35.81. The S&P 500 ($SPX), which remains near a record high, also raises questions about whether companies like GameStop can move beyond structural issues.