After the close last night, video-game retailer GameStop (GME: sentiment, chart, options) reported adjusted third-quarter earnings of 38 cents per share on sales of $1.7 billion. Analysts were looking for a profit of 37 cents on sales of $1.83 billion. Looking ahead, GME expects full-year earnings of $2.35 to $2.40 per share, with total sales rising 21% to 22%. In an accompanying statement, the company said recent same-store sales figures are "showing surprising strength given the unprecedented economic and financial crisis."

In response, analysts largely held their ratings on the shares in check, but price-target cuts flooded the news wires. Specifically, UBS cut its target to $30 from $38, Wedbush cut GME to $27 from $34, S&P Equity Research lowered its target to $12 from $28, and Credit Suisse cut the shares to $34 from $42. According to Thomson Financial, the average 12-month price target for GME stands at $40.62 per share, a 130% premium to the stock's current trading range and a sign that additional target cuts could be on the horizon.

That said, I believe that analysts might be surprised by holiday video-game sales amid the current economic downturn - GME indicated as much in statements accompanying the earnings release. Furthermore, sales of video games and related hardware are on the rise, according to recent reports, and select game producers such as Activision Blizzard (ATVI) are turning in impressive sales figures on some of the season's hottest titles.

Unfortunately for GME, it seems that, despite their price-target cuts, analysts are fully aware of the potential for strong holiday sales. According to Zacks.com, all 12 analysts following the shares rate them a "buy" or better. As such, there could be very little buying strength left on the sidelines to help push GME shares higher.

The stock could certainly use the help, as it has fallen more than 71% so far this year, and is hovering just below former long-term support at the 18 level. This region could now provide overhead technical resistance for GME, making a rebound more difficult for the shares.