US Stocks Likely To Open Lower After The Worst Selloff Since 2020: Tariff Announcement Was '100% Smoot Hawley Disguised As Thoughtful Policy,' Says Expert
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Apr 04 2025
0mins
Source: Benzinga
Market Reaction to Tariffs: U.S. stock futures fell sharply following President Trump's tariffs announcement, with the Dow Jones experiencing its fifth-largest drop ever at 1,679 points, while major indices like the S&P 500 and Nasdaq also faced significant losses.
Sector Performance and Economic Data: Technology stocks were hit hardest, with notable declines in companies like Apple and Nvidia, while consumer staples showed resilience. Mixed economic data included a decrease in jobless claims but a decline in the ISM services PMI, indicating varied economic signals.
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Analyst Views on GME
About GME
GameStop Corp. offers games and entertainment products through its stores and ecommerce platforms. The Company operates in four geographic segments: United States, Canada, Australia and Europe. Each segment consists primarily of retail operations, with the significant majority focused on games, entertainment products and technology. The Company has a total of approximately 3,203 stores across all of its segments: 2,325 in the United States, 193 in Canada, 374 in Australia, and 311 in Europe. Its stores and ecommerce sites operate primarily under the names GameStop, EB Games and Micromania. Its Australia and Europe segments also include 38 pop culture-themed stores selling collectibles, apparel, gadgets, electronics, toys and other retail products for technology enthusiasts and general consumers in international markets operating under the Zing Pop Culture brand. Its retail stores are generally located in strip centers, shopping malls and pedestrian areas.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
GameStop Launches Console Trade-In Offer
- Trade-In Initiative: GameStop announced a cash offer of $420.69 for Xbox or PlayStation 5 consoles from April 20 to 22, aiming to boost sales and attract more consumer participation, which is expected to enhance short-term revenue.
- Stock Price Surge: GameStop's shares rose 5% in Wednesday morning trading, marking the best intraday gain in nearly 10 weeks, reflecting market optimism about the company's future deals and investor anticipation regarding potential acquisitions.
- Cash Reserves Status: As of January 2026, GameStop reported cash reserves and short-term investments totaling $9.01 billion, demonstrating strong financial health in the capital markets and providing a solid foundation for future significant transactions.
- CEO Focus on Major Deal: GameStop CEO Ryan Cohen stated in a CNBC interview that the company is eyeing a “very big” deal that could elevate GameStop's market capitalization to hundreds of billions, indicating a strategic intent that could have profound implications for the company's future growth.
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- Stock Price Volatility: Avis Budget Group's shares plummeted 53.7% this week, bringing its market cap down to $8.1 billion, indicating a drastic shift in investor sentiment and reflecting concerns about future growth prospects.
- End of Short Squeeze: The stock experienced a massive short squeeze that drove prices up over 500% in recent weeks, but as market sentiment reversed, the stock quickly fell, highlighting the risks and instability of short-term trading.
- Intensifying Market Competition: Despite Avis's low price-to-earnings (P/E) ratio of 7.2, the rental car industry is highly competitive with limited growth prospects, prompting investors to be cautious about such volatile stocks and avoid chasing highs.
- Investor Strategy Adjustment: Given the current market conditions, investors are advised to focus on fundamental analysis rather than short-term speculation to mitigate potential losses and optimize their investment portfolios.
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- Short Squeeze Collapse: Avis Budget Group's shares plummeted 53.7% this week, marking the end of a prior short squeeze and indicating a lack of confidence in the company's fundamentals, prompting investors to sell off.
- Severe Market Volatility: The stock surged over 500% in the past month but has since retraced 67%, reflecting the limited impact of speculative trading on the company's long-term value.
- Intensely Competitive Rental Market: Operating in a highly competitive rental car market, Avis faces small growth prospects and high disruption risks, and despite a low P/E ratio of 7.2, investors are advised against buying the dip.
- Shift in Investor Sentiment: With the short squeeze's conclusion, analysts note that Avis Budget is not included in the current list of top investment stocks, signaling a significant decline in market expectations for its future performance.
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Michael Burry Increases Holdings in Microsoft and Other Software Stocks
- New Investment Positioning: Michael Burry has initiated a new position in Microsoft and other software stocks, believing these software and fintech payment companies are oversold despite broader market downside risks, indicating his confidence in these sectors.
- Increased Holdings: Burry has also increased his stakes in MSCI, PayPal, and Adobe, which have seen declines of approximately 25%, 37%, and 54% from their peaks, respectively, reflecting his optimism towards these depressed assets.
- Growing Market Concerns: Burry has expressed increasing unease about the broader market, noting that despite persistent geopolitical tensions, the market has experienced an unprecedented rally, suggesting a cautious outlook on future market trends.
- Put Options Strategy: He has raised the proportion of put options to 5% of his portfolio, indicating a more conservative investment strategy in light of potential market volatility under the current conditions.
See More
GameStop's Transformation and EPR Investment Opportunities
- Successful Transformation: GameStop, after four years of declining revenue, has successfully limited its top-line declines by pivoting to collectibles under CEO Ryan Cohen, showcasing its adaptability in the face of digital transformation.
- Improved Financial Outlook: GameStop is projected to achieve positive operating income in fiscal 2025 after six years of losses, indicating a significant improvement in its financial health and potential market floor.
- EPR Properties Investment Opportunity: EPR, a real estate investment trust focused on entertainment properties, offers a 6.3% dividend yield, appealing to GameStop investors, especially in the context of growth in the family entertainment market.
- Stable Rental Income: EPR generates steady rental income through leasing properties, with over a third of its business coming from theaters, further strengthening its connection with GameStop investors and demonstrating robust performance in the entertainment sector.
See More
Investment Outlook for GameStop and EPR Properties
- GameStop Financial Position: GameStop boasts a cash-rich balance sheet with $9 billion in cash reserves, and a net position of $5 billion after accounting for $4 billion in debt, covering nearly half of its market cap, showcasing stability despite ongoing revenue declines under CEO Ryan Cohen's leadership.
- EPR Properties Performance: EPR Properties, a REIT focused on experiential venues, has seen its stock price increase 21-fold since going public nearly 30 years ago, significantly outperforming the overall REIT market, with over half of its portfolio in theaters and 'eat and play' venues, offering a 6.3% dividend yield that attracts GameStop investors.
- Market Positioning Advantage: GameStop serves as a primary retailer in the video game market, providing a smart investment choice for those looking to gain exposure to the entire industry despite challenges from digital distribution, while EPR enhances its appeal through a diversified portfolio of entertainment properties.
- Investment Risk Consideration: While EPR Properties shows strong performance in the entertainment sector, analysts note it was not included in The Motley Fool Stock Advisor's list of top investment picks, prompting investors to carefully evaluate its future growth potential against market competition.
See More
GameStop Launches Console Trade-In Offer
- Trade-In Initiative: GameStop announced a cash offer of $420.69 for Xbox or PlayStation 5 consoles from April 20 to 22, aiming to boost sales and attract more consumer participation, which is expected to enhance short-term revenue.
- Stock Price Surge: GameStop's shares rose 5% in Wednesday morning trading, marking the best intraday gain in nearly 10 weeks, reflecting market optimism about the company's future deals and investor anticipation regarding potential acquisitions.
- Cash Reserves Status: As of January 2026, GameStop reported cash reserves and short-term investments totaling $9.01 billion, demonstrating strong financial health in the capital markets and providing a solid foundation for future significant transactions.
- CEO Focus on Major Deal: GameStop CEO Ryan Cohen stated in a CNBC interview that the company is eyeing a “very big” deal that could elevate GameStop's market capitalization to hundreds of billions, indicating a strategic intent that could have profound implications for the company's future growth.
See More
Avis Budget Group Shares Plunge 53.7% Amid Short Squeeze Fallout
- Stock Price Volatility: Avis Budget Group's shares plummeted 53.7% this week, bringing its market cap down to $8.1 billion, indicating a drastic shift in investor sentiment and reflecting concerns about future growth prospects.
- End of Short Squeeze: The stock experienced a massive short squeeze that drove prices up over 500% in recent weeks, but as market sentiment reversed, the stock quickly fell, highlighting the risks and instability of short-term trading.
- Intensifying Market Competition: Despite Avis's low price-to-earnings (P/E) ratio of 7.2, the rental car industry is highly competitive with limited growth prospects, prompting investors to be cautious about such volatile stocks and avoid chasing highs.
- Investor Strategy Adjustment: Given the current market conditions, investors are advised to focus on fundamental analysis rather than short-term speculation to mitigate potential losses and optimize their investment portfolios.
See More
Avis Budget Shares Plunge 53.7% Amid Short Squeeze Collapse
- Short Squeeze Collapse: Avis Budget Group's shares plummeted 53.7% this week, marking the end of a prior short squeeze and indicating a lack of confidence in the company's fundamentals, prompting investors to sell off.
- Severe Market Volatility: The stock surged over 500% in the past month but has since retraced 67%, reflecting the limited impact of speculative trading on the company's long-term value.
- Intensely Competitive Rental Market: Operating in a highly competitive rental car market, Avis faces small growth prospects and high disruption risks, and despite a low P/E ratio of 7.2, investors are advised against buying the dip.
- Shift in Investor Sentiment: With the short squeeze's conclusion, analysts note that Avis Budget is not included in the current list of top investment stocks, signaling a significant decline in market expectations for its future performance.
See More
Michael Burry Increases Holdings in Microsoft and Other Software Stocks
- New Investment Positioning: Michael Burry has initiated a new position in Microsoft and other software stocks, believing these software and fintech payment companies are oversold despite broader market downside risks, indicating his confidence in these sectors.
- Increased Holdings: Burry has also increased his stakes in MSCI, PayPal, and Adobe, which have seen declines of approximately 25%, 37%, and 54% from their peaks, respectively, reflecting his optimism towards these depressed assets.
- Growing Market Concerns: Burry has expressed increasing unease about the broader market, noting that despite persistent geopolitical tensions, the market has experienced an unprecedented rally, suggesting a cautious outlook on future market trends.
- Put Options Strategy: He has raised the proportion of put options to 5% of his portfolio, indicating a more conservative investment strategy in light of potential market volatility under the current conditions.
See More
GameStop's Transformation and EPR Investment Opportunities
- Successful Transformation: GameStop, after four years of declining revenue, has successfully limited its top-line declines by pivoting to collectibles under CEO Ryan Cohen, showcasing its adaptability in the face of digital transformation.
- Improved Financial Outlook: GameStop is projected to achieve positive operating income in fiscal 2025 after six years of losses, indicating a significant improvement in its financial health and potential market floor.
- EPR Properties Investment Opportunity: EPR, a real estate investment trust focused on entertainment properties, offers a 6.3% dividend yield, appealing to GameStop investors, especially in the context of growth in the family entertainment market.
- Stable Rental Income: EPR generates steady rental income through leasing properties, with over a third of its business coming from theaters, further strengthening its connection with GameStop investors and demonstrating robust performance in the entertainment sector.
See More
Investment Outlook for GameStop and EPR Properties
- GameStop Financial Position: GameStop boasts a cash-rich balance sheet with $9 billion in cash reserves, and a net position of $5 billion after accounting for $4 billion in debt, covering nearly half of its market cap, showcasing stability despite ongoing revenue declines under CEO Ryan Cohen's leadership.
- EPR Properties Performance: EPR Properties, a REIT focused on experiential venues, has seen its stock price increase 21-fold since going public nearly 30 years ago, significantly outperforming the overall REIT market, with over half of its portfolio in theaters and 'eat and play' venues, offering a 6.3% dividend yield that attracts GameStop investors.
- Market Positioning Advantage: GameStop serves as a primary retailer in the video game market, providing a smart investment choice for those looking to gain exposure to the entire industry despite challenges from digital distribution, while EPR enhances its appeal through a diversified portfolio of entertainment properties.
- Investment Risk Consideration: While EPR Properties shows strong performance in the entertainment sector, analysts note it was not included in The Motley Fool Stock Advisor's list of top investment picks, prompting investors to carefully evaluate its future growth potential against market competition.
See More
