GameStop Ratio Analysis

GameStop Ratio Analysis
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GameStop Ratio Analysis
This paper provides a financial ratio analysis of GameStop, an American video game and gaming products retailer. Table 1 below provides the income statements of the company in the Trailing Twelve Months (TTM) - preceding consecutive twelve months. The values assigned to the right are in Billions.
Parameter

Value in billion US Dollars ($)


TTM

1/30/2021

1/30/2020

1/30/2019

Current Assets

2.472




Total Revenue (TTM)

5.345

5.0898

6.4666

8.2853

Cost of Revenue (TTM)

4.0384

3.8303

4.5573

5.9772

Gross Profit (TTM)

1.3072

1.2595

1.9087

2.3081

Profitability Ratio (Profit/Revenue)

0.2446

0.2475

0.2952

0.2786

Asset Turnover ratio( revenue/assets)

2.162




Table 1: Income statements for GameStop (Yahoo Finance).
Indicator

Year Ending January 2021 (in billion $)

Current Assets

0.110

Total Assets

1.551

Shareholder’s Equity

2.472

Dividends

N/A (does not Pay)

Total current liabilities

1.342

Leverage ratio (Equity/liabilities)

1.842

Liquidity ratio (Assets/liabilities)

0.082

Market Ratio (Total Dividends/ Stock Price)

N/A

Table 2: GameStop Ratios
There are various pieces of evidence of GameStop's strengths and weaknesses in the financial statements. First, its constant revenue posting and gross profits over the years indicate a strong brand portfolio. This strength shows the company's viability to expand into new products and services. Additionally, GameStop's revenues indicate high levels of customer satisfaction- which speaks to its relationship with consumers. Also, these revenues indicate a superb performance in new Markets. For example, GameStop posted a gross profit of $1.3072 Billion in the previous TTM, up from 1.2595 in January 2021....