GameStop Corp. (GME) reports second quarter earnings tomorrow with consensus revenues expected to come in at $896 million and earnings of -$0.01 per share. This follows disappointing previous earnings announcement with both revenues and earnings missing consensus estimates. Surprisingly although GME’s stock price fell -3.4% on the earnings release the stock rallied with a +100% return in the month following the miss.

GME is currently the fifteenth largest short in the Specialty Retail sector:

GME has been a very squeezable stock in 2024 with 25.5 million shares, worth $609 million, of short covering during the year, a -42% decline in total shares shorted. Over the last thirty days we have seen the trend continue with 1.4 million shares bought to cover, worth $33 million, a -4% decline in total shares shorted.

GME is a still a squeezable stock right now, with a 75/100 S3 Squeeze Score, but the stock has hit the 100/100 level many times in the first six months of the year as its stock price rallied. GME shorts are down -$505 million in year-to-date mark-to-market losses, down -54% for the year and are down -$17 million in September month-to-date mark-to-market losses, down -2% for the month.

Since GME hit its year-to-date high of $48.75/share on May 14th we have seen 32.8 million shares bought to cover, worth $785 million which was in response to the squeeze caused by the -$2.2 billion of year-to-date mark-to-market losses they incurred from 1/1/24 to 5/14/24. Since then GME’s stock price has slipped but the shorted shares have never come back.

In addition to the short side of the market trimming its positions we are seeing the long side building theirs. Using our Black MAP product to track institutional long holders we see those Active long shareholders (brokers, hedge funds, investment advisors, etc.) increased their long holdings by 3.8 million shares to 12.1 million shares in 2024, a +46% increase in total shares held long.

On the Passive side (investment advisors, mutual funds, pension funds, etc.) we also saw an increase in long shareholding with a 4.1 share increase to 86.0 million shares, a +5% increase in total shares held long.

Overall, Passive long shareholders own 20.2% of GME’s shares outstanding and Active long shareholders hold 2.8% of GME’s shares outstanding. 23.0% of GME's shares are being held long by larger institutions and 76% held long by smaller institutions and retail. In January the number of long shares held by larger institutions was 26.6% but on a smaller shares outstanding of 305.5 million shares or 19.1% of the present shares outstanding of 426.3 million shares.

Using today’s GME shares outstanding institutional ownership as increase by +3.9% since the beginning of the year.

With shorts covering and longs buying it looks like there is positive price sentiment on both sides of the market. If tomorrow’s results come in at or near consensus it looks like GME is poised for a rally.

Our Blacklight SaaS platform and Black App provides an up-to-date view of short selling and short covering on an equity, sector, index, or country-wide basis allowing investors\traders to better manage their existing long and short positions. The Black MaP and Black App products provide a total view of long and short positioning in the market with a breakdown between Active\Passive long investors, 24 Fund type entities, over 50k securities globally across 108 countries and data from 58 regulatory exchanges.