GameStop (NYSE:GME) stock just got its price target cut by Wedbush analysts in response to a recent equity offering from the video game retail business.
This saw Wedbush analysts cut the firm’s price target for GME stock from $13.50 per share to $11 per share. That’s a potential 64% downside compared to the stock’s previous closing price.
Investors will also note that Wedbush doesn’t hold a positive rating for GME stock. The firm maintained its “underperform” rating for the shares while cutting its price target today.
What’s Behind the Bear GME Stock Stance?
Wedbush remains unimpressed by the company’s recent equity offering that raised $2.14 billion. It did so by selling 75 million shares for an average price of $28.49. Analyst were expecting the company to sell its shares for an average price of $40 each in this offering.
It’s also worth pointing out that this equity offering from GameStop comes after the return of Roaring Kitty. This trader has often hyped up the stock and helped kick off its meme rally a few years back. GameStop was looking to capitalize off of his return with this offering.
GME stock is up 6.9% as of Wednesday morning.
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On the date of publication, William White did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
