Cramer, however can't shares the bulls' enthusiasm – instead he sees the case outlined above as a lot of bull.
"On Tuesday morning, GameStop reported some very weak holiday numbers, with same store sales for the nine weeks compromising the holiday season down 4.4%," said Cramer.
"The fourth quarter is the most important one of the year for GameStop by far, when the company gets slightly more than half of is annual profits. And it looks like they blew it."
And the situation doesn't look like it's going to turn anytime soon.
"The company gave negative same store sales guidance for their fiscal fourth quarter, which ends on January 28th—they said they're looking for a 4 to 7 percent decline," Cramer explained.
Those results alone are enough to raise eyebrows.
However, bulls may argue they're a consequence of poor management and if management gets their act together, all will improve.
The bulls also argue that GameStop can close stores—they plan to shut down 200 this year—cut marketing costs and buyback stock. Bulls also say that GameStop is ripe for a takeover.
You could argue all that – but Cramer thinks there's another catalyst looming - one that's much more ominous and trumps all else.
"In the last couple of years, the nature of the gaming business has changed dramatically in ways that are very bad for GameStop. Instead of buying video games in a store, we now have free online gaming like Zynga, we have cheap mobile games like you play on your smartphone, and the publishing industry has gotten behind digital distribution, where you can download video games straight to your console or computer, rather than having to take a trip down to the store," Cramer explained.
In other words, why would a customer spend $60 for a videogame at GameStop when they can either play games for free online or pay next to nothing. A download of the new Angry Birds is $0.99.
"These changes are getting more dramatic by the day, and they make you wonder whether a big part of GameStop's business, selling hard copies of new and used games, might be becoming obsolete."
Bulls argue that GameStop plans to grow its digital business—selling games over the Internet—dramatically over the next couple of years.
But Cramer says, "I don't see how they can compete against more established online players. The fact is, GameStop has to compete with Amazon on way too many fronts for my liking. You don't want to be in competition with Amazon like this."
Cramer sees every reason to sell.
GameStop right here reminds me a bit of Best Buy or RadioShack a few years ago, when it became clear that their core businesses were being pillaged and they had no way to fend off the competition."
Again, "Those stories have not ended well, and I don't see GameStop ending well either.," Cramer said.
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