A GameStop store in San Francisco.
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GameStop ‘s executive hiring spree continued on Tuesday, with the company adding a former Amazon.com executive and two alums of Chewy.
Elliott Wilke will be GameStop’s chief growth officer. GameStop (ticker: GME) said Wilke held a variety of senior roles at Amazon.com over the past seven years. He was involved in the company’s Amazon Fresh, Prime Pantry, and Worldwide Private Brands segments. He will start at GameStop on April 5.
The company also brought on Andrea Wolfe to be its vice president of brand development and Tom Petersen for vice president of merchandising. Wolfe was previously vice president of marketing at Chewy (CHWY), while Petersen was a vice president of merchandising.
GameStop stock’s parabolic rise was likely driven by excessive bearish bets from hedge funds blowing up, wild trading, options activity, and the high-profile retail investor movement that has been along for the ride. But the spark that likely ignited the squeeze was a January announcement that Chewy co-founder Ryan Cohen and two associates were joining the company’s board.
Cohen had called for drastic changes at GameStop as he built a stake in the company in 2020. The latest hires join a group of newcomers with strong e-commerce backgrounds coming from firms like Amazon, Chewy, and Walmart (WMT). The company is looking for a new chief financial officer with a technology background.
GameStop stock fell as low as $2.57 in the past year, but has surged as high as $483 as retail investors latched onto the stock in a public spat with those they saw as Wall Street elites who were betting GameStop would go the way of Blockbuster or RadioShack. The company had been slow to embrace online services and saw plenty of executive turnover in the past few years.
While GameStop’s positioning as a physical disc seller at a time when the pandemic has accelerated a shift toward direct digital downloads on consoles had hammered GameStop stock in the first half of 2020, its e-commerce sales have surged with the company rolling out new options like curbside pick up.
The company is looking to sell other products of interest to gamers, like collectibles and computer parts.
Cohen has garnered praise for his experience running the upstart Chewy to compete with Amazon in the pet business. GameStop faces stiff competition from direct-to-consumer firms and retailers other than Amazon, like Best Buy (BBY) and Steam.
GameStop stock was up 4.5%, to $189.30, on Tuesday morning. Its share price has exceeded even the most optimistic Wall Street analyst price target, which is Jefferies analyst Stephanie Wissink at $175 with a Hold rating. The mean target listed by FactSet is $45.42.
The company said in a filing with the Securities and Exchange Commission earlier this month that it was evaluating whether to expand a previously announced $100 million at-the-market stock sale. While selling stock could help fund new efforts, it could also dilute existing shares and make it easier for short sellers to cover their positions.
In the meantime, it may be safe to assume GameStop’s volatility will continue until investors have better benchmarks on how to judge its turnaround and a better idea of what it will cost.
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