What Happened?
Shares of video game retailer GameStop (NYSE: GME) fell 11.4% in the morning session after the company announced its first purchase of Bitcoin (4,710 Bitcoin) valued at more than $500m. The purchase was announced on a day when crypto assets were losing momentum.
The market's reaction, amid declining sales, also likely reflected uncertainty among investors. The weak reaction suggested that many shareholders were likely unsure whether this shift toward crypto represented a true diversification or a high-risk distraction from core issues holding back growth.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Is now the time to buy GameStop? Access our full analysis report here, it’s free.
What The Market Is Telling Us
GameStop’s shares are extremely volatile and have had 51 moves greater than 5% over the last year. But moves this big are rare even for GameStop and indicate this news significantly impacted the market’s perception of the business.
The previous big move we wrote about was 1 day ago when the stock gained 5.7% after the major indices rebounded (Nasdaq +2.0%, S&P 500 +1.5%) as President Trump postponed the planned 50% tariff on European Union imports, shifting the start date to July 9, 2025.
Companies with substantial business ties to Europe likely had some relief as the delay reduced near-term cost pressures and preserved cross-border demand.
GameStop is up 1.3% since the beginning of the year, but at $31.05 per share, it is still trading 33.3% below its 52-week high of $46.55 from June 2024. Investors who bought $1,000 worth of GameStop’s shares 5 years ago would now be looking at an investment worth $28,683.
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