GameStop (GME) Stock: Collectibles Sales Surge 57% — Why I'm Setting a $27 Price Target

GameStop's collectibles business is booming while traditional retail sales decline. Could its expanding investment portfolio unlock a new chapter of growth?

Ask Warren HQ | Independent Market Research | November 3, 2026

GameStop Corp. (NYSE: GME) is evolving into an unusual combination of specialty retailer, collectibles business and investment-focused company, creating a valuation challenge that extends well beyond its reputation as a meme stock. GameStop's second-quarter fiscal 2026 results, released September 8, revealed a striking contrast between its traditional retail operations and its emerging business priorities. Total quarterly revenue declined from $972.2 million to $790.2 million, but collectibles revenue increased 57% to $356.3 million, representing 45.1% of total sales. The company also reported the highest second-quarter operating income in its history. I believe these developments deserve greater attention because they suggest that GameStop's profitability may increasingly depend on a smaller, more focused retail operation supported by higher-margin merchandise and substantial financial investments. With shares closing at $24.19 on November 2, I see a company with meaningful financial resources but an uncertain long-term operating identity. Consequently, I am establishing an initial HOLD (Speculative) rating with a 12-month price target of $27.00, reflecting cautious optimism about management's capital allocation strategy while recognizing the risks associated with its evolving business model.

My financial justification for the $27 price target begins with GameStop's balance sheet, improving operating profitability and growing exposure to collectibles. At August 1, 2026, the company reported approximately $4.85 billion in cash and cash equivalents, $206 million in marketable securities and $294 million in digital assets and related receivables. In addition, GameStop held an equity investment in eBay valued at approximately $4.95 billion, bringing these financial assets to roughly $10.3 billion before accounting for liabilities. However, the company also carried approximately $4.17 billion in long-term debt, making it important to distinguish gross financial assets from net financial value. Quarterly operating income increased to $160.2 million from $66.4 million a year earlier, supported by a more profitable product mix and lower operating expenses. Management also raised its fiscal 2026 adjusted EBITDA outlook to more than $650 million. Using approximately 449 million common shares as a valuation reference, my $27 target implies an equity value near $12.1 billion. I view this as a recovery scenario in which GameStop's financial investments retain substantial value and its streamlined retail business sustains improved profitability. Nevertheless, I would not assign a larger premium without stronger evidence that the company can produce durable earnings and create value from its considerable investment portfolio.

My final assessment is HOLD (Speculative), with a 12-month price target of $27.00. Relative to the November 2 closing price of $24.19, my target represents approximately 11.6% potential share-price appreciation over the next year. I would consider raising my valuation if GameStop delivers sustained operating income growth, expands its collectibles business, generates consistent free cash flow or demonstrates that its investments can produce meaningful long-term shareholder returns. Conversely, continued deterioration in traditional video game retail sales, declining investment values, unexpected losses on digital assets, additional dilution or unsuccessful capital allocation decisions could lead me to lower my target. I am particularly interested in how management balances investment opportunities with the need to maintain a profitable core retail operation. Although GameStop's substantial financial resources provide strategic flexibility, I believe investors should avoid treating its investment portfolio as equivalent to cash available to shareholders, especially given its debt obligations and exposure to market fluctuations. For now, I see a potentially improving business whose valuation still requires considerable caution. The question guiding my outlook is whether GameStop can transform its financial assets and expanding collectibles operation into a sustainable business that deserves a higher market valuation.

Ask Warren HQ | Independent Market Research

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Research References: GameStop Q2 2026 Financial Results | GameStop SEC Form 10-Q | GameStop Investor Relations

This article represents my independent market research and opinions published through Ask Warren HQ for educational and informational purposes only. My stock ratings and price targets are estimates, not guarantees of future performance or personalized investment advice. Financial information reflects available data as of November 3, 2026, and may change. Readers should verify current information and conduct their own due diligence before making investment decisions. Please review the Disclaimer, Privacy Policy & Terms of Use.