Despite a 30 percent short interest, shares of GameStop could see significant gains, Michael Pachter of Wedbush Securities said Thursday.
"If you look at the games industry, it peaked in 2008," he said. "It's declined about 40 percent since."
But that wasn't the whole story.
"If you looked at GameStop's revenues in 2008, $8.8 billion, in 2012, $8.9 billion," Pachter said. "So, they've picked up a ton of market share, and we're now right on the edge of new consoles coming out for their core customer, which is the Xbox One and PlayStation 4."
Shares of GameStop closed at $40.87, up 1.21 percent.
"They are going to thrive when game sales rebound, and I actually think game sales are going to rebound," he said. "I think the stock was weak because people feared digital downloads. All three consoles out in the market are using discs.
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"The used-games market is going to be protected."