Can video game retailer GameStop (NYSE:GME) stage a huge comeback, and GME stock shake off its meme-stock reputation? It won’t be easy for GameStop to get Wall Street to take the company seriously. Prospective investors should be careful as an event is coming in December that could prove to be make-or-break for GameStop and its loyal shareholders.

Don’t get the wrong idea. I’m not suggesting that GameStop stock will die. However, there are risks involved as GameStop is in the midst of a critical transition phase. So, caution is definitely advised.

GME Stock Desperately Needs a Turnaround Moment

The meme-stock heyday is in the rear-view mirror, and traders shouldn’t expect GME stock to revisit $80 anytime soon. Even getting back to the 2023 peak of around $27 will be difficult.

Let’s face it – GameStop stock has been on a downward trend since June. With interest rates much higher now than they were in 2020 and 2021, the market isn’t in a mood to speculate on an unprofitable business like GameStop.

Clearly, GameStop’s shareholders desperately need a turnaround event. It’s a challenging time for the company because it’s in a transitional period. First, GameStop’s chief financial officer resigned earlier this year. Also, Ryan Cohen replaced Matthew Furlong as GameStop’s CEO.

Cohen is an interesting individual and may be considered controversial. He founded Chewy (NYSE:CHWY), a pet product e-commerce business. Cohen reportedly sent an e-mail to some GameStop employees stating, “Extreme frugality is required,” and, “Every expense at the company must be scrutinized under a microscope and all waste eliminated.”

Here’s the All-Important Date for GameStop Stock

GameStop’s most recently released quarterly results didn’t reflect Cohen’s leadership as GameStop’s CEO. However, an upcoming event will provide Cohen with an opportunity to provide a road map for GameStop for 2024 and beyond.

You’ll definitely want to mark your calendar for Dec. 6, as that’s when GameStop will release its results for the third quarter for fiscal 2023. Undoubtedly, the market will pay close attention to the earnings report and conference call to find out what Cohen has to say.

Notably, GameStop reported a net earnings loss of one cent per share in the quarter ended July 29, 2023. The company was very close to profitability. Remember, GameStop lost 36 cents per share in the year-earlier quarter.

Can GameStop achieve profitability under Cohen’s leadership? And what does Cohen envision for GameStop in the coming quarters? What will his policy of “extreme frugality” look like? Hopefully, investors will get definitive answers to these questions on Dec. 6.

Just Relax and Be Patient With GME Stock

With Cohen at the helm, GameStop may have a turnaround event coming on Dec. 6. However, depending on the quarterly results and Cohen’s remarks, GameStop stock could either soar or tank.

Unless you’re a gambler, it makes sense to wait until Dec. 6 has come and gone instead of jumping into a hasty trade with GME stock. There’s a lot at stake, as GameStop might be on the cusp of a turnaround but may also disappoint investors. Therefore, stock traders shouldn’t make any moves until GameStop reveals its quarterly data and Cohen provides more clues about the company’s future plans and strategy.          

On the date of publication, David Moadel 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.