GME Ryan Cohen DD #stillholding #diamondhands #ilikethestock Original post at WSB but got removed without clear reason

• on November 16, 2020 The letter to GME Board of Directors, the title reads: Maximizing Stockholder Value by Becoming the ULTIMATE Destination for Gamers (Cohen didnt use the word ULTIMATE lightly, proof below)

• Cohen mentioned he wants to disrupt industries

• Cohen has done it before with this ULTIMATE Destination idea with Chewy - calling it the 1 stop solution - Chewy rapidly expanded product offering to include all pet food and supplies so there was never a reason to shop elsewhere. By 2018, 90% of our revenue was from repeat customers. Cohen is planning to do the same in Gamestock (and how did Cohen achieve (90% repeat customers? cont. reading)

• Cohen left Chewy because - I’m a business builder, not a manager. My work was complete. But I was no longer in FULL CONTROL. And I DIDN’T want a BOSS. (meaning he wont be passive in GME board, if the letter to the board didn’t make the point clear enough)

Formula for creating Fans(90% returning), not customers:

• net promoter score (NPS), a common measure of customer satisfaction, Chewy always 87 and above at Chewy. lemonade is at 70 . Netflix 68, Amazon 62, and Apple 68.

• New Hire - Kelli Durkin, Senior Vice President of Customer Care – Ms. Durkin, who previously served as Chewy’s Vice President of Customer Service, has a start date at GME of March 1, 2021.

• - handwritten holiday cards

• • Our customers would send us photos of their pets all the time. We hired artists to turn those photos into personalized portraits of their pets, which we sent to our customers. These are high-quality drawings, something you’d want to hang in your bedroom. Today, thousands of those portraits get shipped out every month.
• • flowers when their animals pass away.
• • A 24-hour customer service line promises to answer any call within six seconds.
• • And, yes, the customer is always right.
• • If they needed something faster than we could ship it, like that day, we told them to go to a local store and buy it and we’d reimburse them
• • fairly common to see calls with customers go on for 4 hours. That was a good thing because we knew that meant someone was happy. Who can argue for four hours?
• This created Fans, just like Apple/Tesla - Fans tell all their friends and family - When people shop at Chewy, they really understand we care about them, we care about their pets, and they want to tell all their friends and family.” “ i don’t know too many businesses that ended up not being successful when they did a really good job at delighting their customers.”

Hiring

• Will hire the best people and delegate into their areas of expertise. (proven by recent hires)

• We hired for passion. Many people quit stable jobs and relocated with their families from across the country to join us. It was a tremendous sacrifice that we never took lightly. (only 2% write back in linkedin)

• New Hire - Josh Krueger, Vice President of Fulfillment – Mr. Krueger, who previously held senior fulfillment roles at Amazon, Walmart, and QVC, has a start date of March 1, 2021. In his new role, Mr. Krueger will oversee the management of e-commerce fulfillment centers.

• New Hire - Matt Francis to the newly-created role of Chief Technology Officer. Mr. Francis has a start date of February 15, 2021. Engineering Leader at Amazon Web Services. responsible for overseeing e-commerce and technology functions.

Mindset

• Prioritized long term growth over short term profitability (just like tsla, amzn, turning GME into a growth stock, so a ps ratio of 1 is just crazy cheap now)

• Aims for Hypergrowth

• Move fast - In just 3 months we built a website, found a distributor and partnered with a third-party logistics company when starting Chewy. Expect to see the same in GME.

• Workaholic - lead by example and expect my team to work hard too

• Fast - build Chewy first fulfillment center in 6 months rather than 18 months (as estimated by an Consultants initially)

• Great character - Respect co workers - And I couldn’t expect them to treat each other with respect if I was being a dictator. humble

• Confidence to be misunderstood, to able to believe in his vision and see pass competing head-on with Amazon and the pets.com failure during the dot com bubble

• Aims to underpromising and overdelivering on sales

• Simple formula for success in Chewy that can be duplicated in GME 1. amazing customer service 2. low prices 3. fast shipping 4. selection

• Dares to dream - aims to be industry leader - last thing you want to be is a subscale e-commerce company. You’re a dead man walking, and Amazon will crush you.

• not afraid to go against the the board/traditional rules - building a company in Florida rather than a popular tech hub. spending $3 million a month on TV ads, more than Home Depot HD -0.3%’s budget. hiring expensive executives even though we weren’t profitable. These decisions were some of the most controversial and required me being comfortable betting against conventional wisdom, and were often contrary to the advice of my board. Suffice it to say, I was not the most popular board member. (proof that he will make GME team do what he says/take over as CEO)

• Transformation of GME started - By the end of the latest fiscal year, GameStop will have closed more than 1,000 stores since mid-2019

• Adding PC gaming, computers, monitors, game tables and gaming TVs to its store.

• I learned the value of hard work and being a jack of all trades, and that you should never be afraid to do things yourself.

Others:

• Ability to raise money - raised 6 rounds of financing totaling more than $350 million from T. Rowe Price, BlackRock, Greenspring, Lone Pine, Verlinvest, and the investment bank Allen & Company for Chewy

• Vertically integrated e-commerce requires flawless execution across many fronts — marketing, supply chain, merchandising, and everything in between

• will protect shareholders - Those investors put their trust in me and my vision,” Cohen writes, “and I repaid them with returns.”

• never afraid to say no. I was constantly bombarded with new ideas, and when you’re growing quickly it’s critical to stay focused, so I said no to almost everything. There’s a time and place for ideation, but in the early days when resources are finite, it’s important to choose a handful of things and do them extremely well. (just like Steve Jobs)

• can handle a big business - scaled from 3 employees in 2011 to over 9000 Chewtopians by 2018.

REMEMBER!!! Cohen aim to Maximizing Stockholder Value by Becoming the ULTIMATE Destination for Gamers. ULTIMATE. I for one wants GME to go into manufacturing and make a Macbook quality Gaming laptop. Its about time this thing gets made)

update 1: alot of ppl are asking what the price target is. So im going to give it a shot, but since im such a newbie, pls advise if im calculating this wrong.

P/S Ratio = current share price / [1 year revenue/ shares outstanding]

currently

0.626 = $49.64 / 79.3

2 years down the road, maybe

20 = $1585.94 / 79.3

$1585.94 … ~32x in return

Assumptions:

PS ratio of 20 - im comparing with the companies below, which can be very controversial because i heard we are not suppose to compare PS ratio between vastly different companies, but im doing it anyway. And of course, GME is being priced as a growth stock at this PS ratio level.

TSLA = 27 ROKU = 38 BYND = 26 LMND = 78 SQ = 16

1 year revenue - stays the same. Which I don’t believe it to be true since there will be additional revenue from adding PC gaming, computers, monitors, game tables and gaming TVs to its store + boosted online revenue (Cohen is very focus on). Which also means my price target of $1585.94 is too low.

Shares outstanding - stays the same. (which likely will increase but it shouldn’t be too much since Cohen explicitly mentioned “Maximizing Stockholder Value” + his track record of Chewy

Update 2: It seems wallstreetbets removed my post and didn’t give me a reason… its pretty weird… anyone know what’s going on? I should have said its not investment advice? haha

Im reposting here at r/GME and also r/investing10x

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