Barron’s reported on Nov. 8 that the New York State Teachers’ Retirement System sold 13,601 shares of GameStop (NYSE:GME) stock in the third quarter

Fear not, meme-stock lovers. The pension fund still owns 61,150 shares of GME stock.

According to WhaleWisdom.com, GameStop is the pension fund’s 532nd-largest holding, so it’s clearly not a big deal and most likely a case of taking profits. The fund first bought GME in Q4 2005 paying. Over its history holding the retail stock, it’s estimated to have paid an average of $40.01 per share. 

GME stock is on a roll at the moment. Its shares are up more than 9% over the past month, trading over $200 for the first time since September. 

While the teachers’ retirement fund was merely trimming its holdings as any large fund would do, I believe there remains a bearish argument to be made about the company and its stock.

Here’s why.

GME Stock Loses a COO

GameStop parted ways with Chief Operating Officer Jenna Owens on Oct. 28, just seven months after joining the company. Owens’ parting gifts were six months base pay, health benefits for six months, and the remainder of her sign-on bonus.

In case you’re wondering, her sign-on bonus was $2.5 million over 24 months, payable in 12 monthly installments of $125,000 for the first 12 months of her employment and 12 monthly installments of $83,333.33 over the next 12 months. So, this means the company forked over $1.625 million [$2.5 million less (7 x $125,000)] as part of her separation agreement. 

That’s not a bad gig: $3.9 million in salary and bonus over seven months. That’s an average of $557,143 per month worked. 

Former CEO George Sherman hired Owens in March. A few weeks later, Sherman announced that he was stepping down at the end of July. He ultimately left the company on June 21. He was replaced as CEO by Matt Furlong. 

Interestingly, Owens and Furlong are both Amazon (NASDAQ:AMZN) alumni. 

Owens worked in Seattle for Jeff Bezos and company for four years and three months, leaving to join GameStop in March. Her last position at Amazon was director and general manager for distribution and multi-channel fulfillment. As for Furlong, he worked with Amazon for eight years and eight months, leaving as head of its Australian operations, to join GameStop in June as CEO. 

It’s more than likely that their paths crossed while at Amazon. The fact that she’s leaving after just seven months suggests Furlong wasn’t comfortable with her as his No. 2. But, unfortunately, I’m not sure we’ll ever find out the entire story.

It’s also possible Chewy (NYSE:CHWY) co-founder Ryan Cohen, whose investment firm RC Ventures owns almost 13% of the company’s stock, wanted his own person responsible for the fulfillment side of the business. But, again, we’ll likely never know the truth. 

A third possibility is that former Chewy executive Neda Pacifico, brought in to head up its e-commerce business, didn’t see eye to eye with Owens. Given her background with Chewy and Cohen, it might be the most logical reason for the departure of its COO. 

A Transparency Problem

In early October, I suggested that until GameStop revealed more of its e-commerce plans, I didn’t think GME stock would go too far in either direction, up or down. 

Amazingly, despite nothing new to report since my article, GME is up 20%. It seems the Reddit crowd can buy enough of its stock. I fail to understand the interest. 

Here’s what I said on Oct. 4:

Until the savior, Ryan Cohen, provides investors with a point-by-point plan of action, including e-commerce details, my colleague’s [Larry Ramer] right to suggest its expensive at 3x the analyst’s average 2022 revenue estimate. And, as I said in my [September] article, trading at almost 200x its TTM FCF, investors know they can get more for less.

It’s been a few weeks since the SEC reported on the January meme stock surge. Not surprisingly, the regulator didn’t come to any conclusions. 

However, the Federal Reserve’s biannual financial stability report issued on Nov. 8 did have something to say about meme stocks. 

“[S]ocial media can contribute to an ‘echo chamber’ in which retail investors find themselves communicating most frequently with others with similar interests and views, thereby reinforcing their views, even if these views are speculative or biased,” page 20 of the report states. “More generally, social media platforms allow a single comment or post to reach millions of people and potentially affect market sentiment dramatically within a short period.”

It concluded that should retail investors lose their heightened appetite for risk; there would be a destabilizing effect on the markets, ratcheting up volatility to levels likely rarely seen by young investors.

One of the primary targets of this volatility would most assuredly be GameStop.

The Bottom Line

According to MarketWatch, the four analysts who cover GME stock have a sell rating and an average target price of $71, 66% lower than where it currently trades. Further, GameStop lost $2.17 in 2020, is expected to lose $1.10 this year, and 21 cents in 2022. 

But as my colleague, Josh Enomoto recently said, the fact the company’s COO left after seven months in the job and the news did little to slow the GME train suggests a segment of retail investors won’t listen to reason. It sounds a lot like the anti-vaxxers. 

I don’t think there’s any question that GameStop’s business has improved over the past year. However, that doesn’t mean GME stock is worth $200, or even $100 for that matter. 

Do yourself a favor and find another retail stock to worship. You can thank me later.

On the date of publication, Will Ashworth 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.

Will Ashworth has written about investments full-time since 2008. Publications where he’s appeared include InvestorPlace, The Motley Fool Canada, Investopedia, Kiplinger, and several others in both the U.S. and Canada. He particularly enjoys creating model portfolios that stand the test of time. He lives in Halifax, Nova Scotia.