Position Update: GME

Lazard Capital Markets notes that this morning the Chief Marketing Officer of Best Buy (BBY) disclosed on his blog that Best Buy is testing sales of used video games in stores in Dallas and Austin. The kiosks also allow customers to trade used games for store credit through the kiosks. While firm believes that BBY's entry into the used video game market will create a new overhang on shares of GME, firm expects BBY's initiative to expand the used video game market rather than take significant share from the specialty channel. Firm estimates the size of the commercial used video game market in the $2.5 bln range worldwide, continuing to grow, driven by major players including GME, Game Group, Game Crazy, and Internet marketplaces such as eBay (EBAY) and Amazon (AMZN)."