GameStop soars as E3 gaming blitz heats up

NEW YORK (AP) -- Shares of GameStop Corp. soared Tuesday as video game companies from Sony Corp. to Electronic Arts Inc. revealed new details about upcoming games and consoles at the E3 conference in Los Angeles.

THE SPARK: The E3 video game expo officially started on Tuesday, though Microsoft Corp. held its presentation a day earlier, revealing that its upcoming Xbox One console will cost $499, higher than expected. On Tuesday, Sony announced that the forthcoming PlayStation 4 will cost $399. Both companies showed off footage from new games geared to get players excited about their consoles.

ANALYST COMMENT: Baird analyst Colin Sebastian said strong console competition is "healthy" for retailers such as GameStop — and for video game publishers such as Activision and EA.

"With retail competition likely to intensify at launch, we note GameStop remains well differentiated with core gamer focus, used games and store locations," Sebastian wrote in a note to investors.

BACKGROUND: GameStop is the world's largest video game retailer. This year's holiday sales will be important for the company because it's been several years since the launch of new gaming consoles.

SHARES: GameStop's stock rose $2.95, or 8.5 percent, to $37.94 in afternoon trading. The stock has traded in the 52-week range of $15.32 and $39.87.