Why not to Invest in Gamestop and AMC, even though the internet is driving those prices high?

Hi guys, I normally don’t release special covers and really I didn’t wanna release this but oh well.

This is my take on why you shouldn’t invest in AMC, Gamestop, because of the Wall Street Bets group on Reddit.

Because this is a special cover I’m going to go in detail about both companies. Normally, I don’t but because this is a blog and this is a special blog nonetheless I decided to do so. Normally I upload on Saturday Afternoons or Saturday Evenings and I usually write a Weekly or Monthly Shortlist and then a small piece or two after that about the state of the economy. So if this is your first time looking at my blog Welcome!

What are Gamestop and AMC?

Gamestop is a national game outlet who during the great Pandemic has hit new lows and has already declared Class A bankruptcy. Gamestop has over 1000 stores nationwide and had assets in the billions. Now their bleeding money, more like hemorrhaging it.

Gamestop’s price was at the low 20’s till Wednesday at about noon when suddenly it shot to about the 140’s then to the 350’s Thursday Morning. It’s settled since but what’s so weird about it is that it was Reddit that was responsible for this bloke of an issue. It climbed so high so fast that Robinhood shut down trading temporarily.

AMC is a multinational theater group consisting of over 1000 or more US locations and digital platforms. AMC has not restructured their company to marginalize their Rate of Return for their Digital Products in a way like HBO, Disney+Netflix and Hulu. While other major networks like Disney and ESPN were quick to capitalize on the digital trend AMC was actually one of the last to join the club of Digital Media in late 2019. AMC filed for Class A Bankruptcy as well and their Stock price hit 1.07 before the Reddit bubble it shot up to 14.95

So now that you know where they were at and how they rose to those ridiculous returns, let’s go over how they need to grow to sustain those and if they are truly probable to grow that high and why you shouldn’t buy them!!

To be probable or not to be that is the question!!

This part will be about making sure the companies can handle rapid exponential growth over long periods of time

AMC is not geared for such exponential growth in fact this has happened but because it happened that year AMC suffered a net loss of around 200+ Million USD and it’s not that they can’t handle that growth its just how quickly that growth occurs.

Physical Establishment are at a disadvantage in the fact that it requires physical space and land development. But because AMC also has a shortage of digital assets they must expand their digital assets then they may be able to handle that kind of growth. Most of their digital assets are in their television network and their network alone cannot handle that rapid Rate of Growth. They would have to try and open their theater to retain their growth or to minimize the risk of losing this blessing.

Gamestop can’t handle it as well, most of their growth is all through retail and online sales. Gamestop sells about 75% of their product through their retail stores and about 25% online.

Gamestop’s online sales is leagues behind that of Walmart, Target, Amazon,and eBay. Logistically speaking, this is a travesty and so if Gamestop aims to keep this rate of growth at bay they have to figure out a way to shift a majority of their sales to online portals rather than in stores retail.

There are other ways that Gamestop can maintain a lead in that field. If they can use this infusion of capital to create a game streaming service they can make billions. Digital Games are the next big thing and so if a major retailer was to do something on this scale it would put them over the top.

Why You should NOT Buy Gamestop or AMC?

In this post we covered what Gamestop and AMC are, how they are flawed in 2021 and now we are gonna discuss why not to buy.

Gamestop and AMC are short term buys meaning that they are good stocks for about the period of a week or so and then they loose their value over time and now that they have experience a rate of exponential growth all at once this stock will soon show its downside. There will be losses you’ve never heard of before.

Gamestop and AMC both rely on real estate and physical land also Demand for Product both of which are not at 100% for either industry. They are not a their peak apex for proper financial health especially AMC. Robinhood would not have deemed this risky if it wasn’t this is extremely risky and it makes sense.

Short Term AMC and GameStop are both good investments but Long Term and especially in this pandemic Economy where 90% of shopping is legitimately happening online neither of these companies stand to survive long enough for the government to provide any aid that will be beneficial long term so it comes to say that its time to pack up shop. Also these two were the victims of a large Reddit bet in which it spiked but spikes usually don’t last and even if they spike they won’t retain the stock long term.


GameStop and AMC are both short term gains with little long term upside, they will only proceed to losses soon and later to negative net worth.

DO NOT INVEST in them and if you have then now is the best time to sell. You will see a healthy profit. Long term investments will always be the way to go but short term will never be good for anyone.

Short Term investments hit their all time highs and then never break that high ever again. Stocks like GoPro, AMC, Gamestop hit an unreachable point and then never break it again.

So In short, Gamestop and AMC are a dangerous gamble and they have no upside in the long run. Investing is all about choice but it never helps to find ones that finish soon, you’ve always got to invest for the longer run.

Now that that’s finished. Find me on Instagram and Twitter and all of my links will be below!!




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