AAP vs GameStop Which Is More Attractive?

In January 2021, the stock market was rocked by two separate yet interconnected events - the meteoric rise of GameStop stock propelled by retail investors from a Reddit forum, and the controversy surrounding trading restrictions imposed by investment platforms like Robinhood. Meanwhile, the AAP stock, which represents the American Association of Publishers, remained relatively stable amidst the chaos. The contrasting fortunes of these stocks highlight the power of individual investors in shaping financial markets and raise questions about market manipulation and equity in trading practices.

AAP or GameStop?

When comparing AAP and GameStop, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between AAP and GameStop.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. AAP has a dividend yield of -%, while GameStop has a dividend yield of -%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. AAP reports a 5-year dividend growth of 0.00% year and a payout ratio of 0.00%. On the other hand, GameStop reports a 5-year dividend growth of 0.00% year and a payout ratio of 0.00%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with AAP P/E ratio at -2.69 and GameStop's P/E ratio at 201.13. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. AAP P/B ratio is -0.60 while GameStop's P/B ratio is 2.64.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, AAP has seen a 5-year revenue growth of 0.24%, while GameStop's is -0.15%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with AAP's ROE at 23.86% and GameStop's ROE at 2.13%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $0.00 for AAP and $27.51 for GameStop. Over the past year, AAP's prices ranged from $0.00 to $0.00, with a yearly change of 500.00%. GameStop's prices fluctuated between $9.95 and $64.83, with a yearly change of 551.56%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.