08:42 AM EDT, 09/06/2024 (MT Newswires) -- GameStop ( GME ) may meet analysts' estimates for its upcoming fiscal Q2 results as industry sales in the quarter remain stable, but the hardware video game retailer does not appear prepared for roadblocks that could stop its return to growth, Wedbush said in a note Friday.

Game sales are continuing to shift from physical to digital and hardware sales are declining as streaming and subscription services dominate, yet GameStop ( GME ) seems to have a "total lack of any strategy to enter new categories with growth potential," analysts from Wedbush said.

Operating profit is expected to remain in the red despite in-line sales in Q2, Wedbush said.

Analysts also noted that GameStop's ( GME ) management "continues to shun investor interaction" as they won't be hosting an earnings call after results are released on Sept. 10 and haven't provided any formal sales or earnings guidance since 2019.

Wedbush kept its rating for GameStop ( GME ) at underperform with a price target of $11.

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