GameStop shares were hopping once again on Tuesday as investors cheered a share sale by the controversial company, normally not the most bullish thing for a stock. Despite the morning pop, Telsey Advisory Group says the meme stock is still an unattractive investment that hasn't given any clarity on its turnaround plan. The Wall Street firm kept its underperform rating and $30 per share price target on Tuesday. GameStop closed Monday at $168.93 a share and were up another 12% in the premarket to $188.40 "The company is soon to be without a CEO, doesn't have a CFO, and we still don't know what Ryan Cohen's vision is for GameStop and the related strategic plan with key milestones," Telsey Advisory Group analyst Joseph Feldman told clients. Last week, GameStop announced its CEO George Sherman will step down by July 31. GameStop's share price started to climb after the bell on Monday when the company announced it sold 3.5 million additional shares , raising $551 million to speed up the company's e-commerce transformation. The company is now in the middle of a shift to e-commerce, spearheaded by activist investor and board member Ryan Cohen, who was Chewy's co-founder. "We continue to believe that GameStop should benefit from the new gaming cycle, with current demand outpacing supply for new generation Microsoft and Sony consoles, and its healthy balance sheet," said Fedlman. "However, the company has yet to show financial success in an industry that is rapidly shifting to digital. And, we continue to believe the current valuation far exceeds our rosy fundamental expectations and projected multi-year benefits from the strategic transformation," he added. GameStop was embroiled in an epic short squeeze fueled by retail investors inspired by Reddit posts in January. GameStop's share price skyrocketed to $483 per share, and subsequently lost 90% of its value. The controversy drew the attention of Wall Street and Washington . — with reporting from CNBC's Michael Bloom.
A person wearing a protective mask exits from a GameStop Corp. store at a mall in San Diego, California, on Thursday, April 22, 2021.
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