Wedbush analyst Michael Pachter downgraded GameStop to Underperform from Neutral with a price target of $29, up from $16, following last night’s Q4 report. The stock in premarket trading is down 14% to $156.70. The results fell below expectations due to COVID-19 mandated closures, shipping constraints during the holidays and severe supply limitations of new generation consoles, Pachter tells investors in a research note. The analyst believes GameStop is well positioned to be a primary beneficiary of the new console launches, and he remains “quite optimistic” that it will return to profitability by the end of fiscal 2021. However, the “high-profile sustained short squeeze” has spiked the share price to levels that are “completely disconnected from the fundamentals of the business,” says Pachter.