GameStop Stock Split: What should investors do?

GameStop 4:1 Stock split:

• GameStop stock jumped after it announced to split its stock in 4:1 ratio on July 18.
• GameStop is splitting its stock to make it more affordable for the retail investors.
• Therefore, the shareholders will receive a stock dividend of three additional shares on July 21.
• Amazon recently split its stock in 20:1 in May, Shopify in 10:1 in June and Google to split its stock in 20:1 on July 15

What should investors do?

• Investors will end up with 3 additional shares, however, the price of each stock will also fall to reflect the post-split value.
• The stock split doesn’t change any business prospects or future earnings. This will just make the stock more accessible to the investors.
• Analysts feel that this split is just a distraction as NFT market is dead, and that was the last thing GameStop did to get people excited. 

Analysts view on overall Gaming industry

• As per analysts, Video game sales are set to decline annually for the first time in years.
• The games and services market is forecast to contract 1.2% on-year to $188 billion in 2022.
• Russia Ukraine war along with supply chain bottlenecks and rising inflation worsened the current outlook for the gaming industry.
• However, the outlook for 2023 remains positive, with sales expected hit $195 billion mark.