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GameStop Up 6 Percent on Orders for new Gaming Systems Begin

In early trading, GameStop (NASDAQ: GME) is up 6 percent while the broader market is down shapely. The gaming retailer is seeing buy interest today after pre-orders began for Microsoft’s (NASDAQ: MSFT) Xbox One and Sony’s (NYSE: SNE) PlayStation 4.

Apple (NASDAQ: AAPL) wasn’t the only electronics company in the news yesterday. The E3 conference which included presentations by Microsoft and Sony of their new gaming systems was big news despite being overshadowed by Apple. Microsoft’s Xbox One will retail for $499 while Sony’s PlayStation 4 will retail for $399. While Sony and Microsoft are going head to head with these new systems, Gamestop is the early winner as gaming enthusiasts line up to be one of the first to receive the new systems once they’re released.

Although GameStop is up today, it might face headwinds thanks to Microsoft. A large part of the company’s revenue comes from the sale of used games. As part of its anti-piracy campaign, Microsoft announced that the Xbox One will not allow used games to work on the console. This caused shares to fall on Monday but Sony will still allow used games on its PlayStation 4.

With the small amount of games and high price tag, the Xbox One hasn’t received an enthusiastic response. Sony’s PlayStation 4 looks to be the winner early on but for GameStop to profit, consumers only have to purchase one or the other.

Disclosure: At the time of this writing, Tim Parker had no position in any of the mentioned equities.

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