GameStop Plans 4-For-1 Split

GameStop’s stock split is finally happening.

The company announced plans to split its stock four-for-one later this month, sending shares higher after the market closed on Wednesday. Shareholders of record at the close of business on July 18 will receive three additional shares for every share owned via a stock dividend. The additional shares will be distributed on July 21, and GameStop (ticker: GME) stock will begin trading on a split-adjusted basis on July 22.

GameStop stockholders in June voted in favour of expanding the company’s share authorisation to one billion from 300 million in order to facilitate a split. The company said in March that the higher authorisation would allow it to implement a split and “provide flexibility for future corporate needs.”

Shares of GameStop rose 5% to US$123.25 in after-hours trading even though stock splits don’t make a company more valuable, given that they are akin to cutting a pie into smaller slices. If GameStop split at its recent after-hours levels, it would trade at $30.81.

That is around the US$30 pre-split price target Wedbush analyst Michael Pachter assigns the stock, which he rates at Underperform. “Makes it more affordable for unsuspecting rubes who haven’t yet lost all of their money,” Pachter told Barron’s via email when asked about the split.

The stock has traded as high as $255.69 in the past 12 months, but it is still up significantly from its 2020 levels. Even the potential post-split number is well above where GameStop shares were trading before Chewy co-founder Ryan Cohen announced a stake and launched a campaign that kicked off the company’s meme-fueled run in January 2021. GameStop stock has fallen 20% in 2022, compared with a 19% drop for the S&P 500 index.

Cohen became the chairman of GameStop’s board a year ago. The company has added executives and employees with technology, e-commerce, and blockchain backgrounds to help turn things around as the business battles the shift to sales of videogames online rather than in stores.

Following the board and management shake-up, the company invested in fulfilment and customer-care efforts, as well as expanding its offerings to include more computer supplies and TVs. It is also launching a marketplace for nonfungible tokens. Experts, like Pachter, are sceptical such blockchain efforts will benefit the stock.

For self-employed Australians, navigating the mortgage market can be complex—especially when income documentation doesn’t fit the standard mould. In this guide, Stephen Andrianakos, Director of Red Door Financial Group, outlines eight flexible loan structures designed to support business owners, freelancers, and entrepreneurs.

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Red Door Financial Group is a Melbourne-based brokerage firm that offers personalised financial solutions for residential, commercial, and business lending.

GameStop Plans 4-For-1 Split

The meme stock saga continues.