GameStop (NYSE:GME) shot “to the moon” during the meme stock trading frenzy of early 2021. However, the gravity of the company’s weak business growth outlook and persistently poor earnings could continue to pull GME stock back to Earth.

Interestingly, though, a new vision could also rescue GME stock from this imminent collapse. That is, when meme-stock traders finally move on and fundamentals-minded, valuation-sensitive investors take over the show.

Still, the market has been waiting for GameStop’s promised new strategic path for months now. That has investors still guessing as to what’s cooking inside the company boardroom.

Here’s what you should know about GME stock moving forward.

GME Stock: History Repeating Itself

At the start of the year, GME stock had heavy short interest — and for good reason. The business was going down. The company had started divesting assets to pay debt and repurchase shares. Losses were mounting and future negative free cash flows were likely to land it back into bankruptcy again.

What’s more, the refresh cycle in gaming consoles wasn’t sure to rescue the business from its downtrend. Especially not when gamers have increasingly been downloading games instead of buying hard copies.

GameStop’s business was first rescued from bankruptcy by astute investor and Barnes & Noble chairman Leonard Riggio, who personally acquired video game retail assets and sold them to B&N. Barnes & Noble then revamped the business, rebranded it as GameStop and spun it off to the public in 2004.

By 2021, it was doomed to fail. However, thanks to Reddit’s r/WallStreetBets and the empowered retail investor crowd on Robinhood (NASDAQ:HOOD), GME stock soared on an unbelievable short squeeze at the beginning of the year. The company then capitalized on the event and issued new shares, including more than $1.1 billion in net proceeds in a June equity raise.

So, GameStop was recently rescued from its potential future bankruptcy — this time by an incensed trading crowd. However, the remaining critical issue is whether GME can successfully transform its business again and justify its lofty valuation.

The Suspense Game and an Emerging E-Commerce Giant

During an annual meeting in June, GameStop chairman Ryan Cohen was quoted saying the following: “We are trying to do something that nobody in the retail space has ever done.”

The market has been waiting for an announcement since then. Yet, as if to avoid giving difficult answers, executives are no longer taking questions during quarterly earnings calls.

That said, something is definitely happening at the company. And GME stock investors keep guessing what GameStop’s new strategy will be. Suspense is rife.

This is part of why it came in as big and exciting news when GameStop announced it was hiring Amazon (NASDAQ:AMZN) veterans to take up leadership roles. New hires included CEO Matt Furlong and CFO Mike Recupero (both formerly of Amazon) as well as Chief Technology Officer Matt Francis (formerly of Amazon Web Services).

The company also made new senior appointments across brand, merchandising, e-commerce, supply chain and fulfillment. Each of the new senior staff members has a background linked to companies like Amazon, Alphabet’s (NASDAQ:GOOG, NASDAQ:GOOGL) Google and Chewy (NYSE:CHWY)

To me, it’s clear that GameStop has dreams of morphing into a game-anchored e-commerce giant. In executing this strategy, the company has expanded its online product categories. It sells gaming gear, laptops, displays, computer memory and a lot more, including apparel and jewelry.

Further, GME recently leased vast space (530,000 square feet) in Reno as well as a 700,000 square-foot facility in Pennsylvania. The company also announced the hiring of up to 500 employees at a new customer care center in Florida back in late September.

All told, GameStop is undergoing a significant transformation. Could it become a smaller version of Amazon? I wouldn’t stretch my imagination that far… but why not?

Watch GME’s Recent Hiring Adverts

These developments aren’t the only thing to appreciate about GME stock, though. GameStop is also venturing into new spaces, including non-fungible tokens (NFTs), cryptocurrencies and possibly augmented reality (AR).

On top of launching an NFT-related portal to invite developers, GameStop is hiring for a Head of Web3 Gaming with a deep understanding of what “gaming partners are trying to achieve and how NFTs can be a key business driver.” The position description also seeks a candidate to “build a team to help creators launch their projects on the GameStop platform,” among other responsibilities. Finally, the candidate will need “experience working in the blockchain/crypto space, especially with Ethereum and NFTs.”

GameStop is definitely onto something here. As Meta Platforms (NASDAQ:FB) transforms and rebrands from Facebook (with an upcoming ticker change in December), GME could also be a strong participant in the metaverse and other emerging technologies moving forward.

Investor Takeaway on GME Stock

All told, this one is still too early to call. But one thing is for sure: GameStop has fresh visionaries on its executive team. This new leadership could certainly “do something that nobody in the retail space has ever done,” as Cohen put it.

That said, GME stock trades at 2.69 times its 2022 sales. Close, profitable competitor Best Buy (NYSE:BBY) trades at 0.52 times 2022 revenue.

When it comes down to it, GameStop is too expensive for a new investor to play its revolutionary transformation right now. And there’s no room for strategic misses on the company’s part.

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On the date of publication, Brian Paradza did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Brian Paradza is an investing enthusiast who was awarded the CFA Charter in 2019. A strong believer in fundamentals-based long-term investing, Brian learns from gurus like Warren Buffett but acknowledges human behavioral tendencies that drive short-term “madness”. You may find him inquisitive as he examines tech investing opportunities, cannabis, blockchains, and the new cryptocurrencies asset class.