Activision Sentiment Remains Strong Ahead of Earnings

 |  Includes: ATVI, DIS, EA, MSFT
by: Jett Winter

Activision (NASDAQ:ATVI) is scheduled to release Q1 earnings this Wednesday, May 5th, after the market close. Average analyst estimates for the WOW developer are $.04/share in EPS and $567 million in Revenue. Twenty-six analysts track the stock with nine upward EPS revisions in the last 30 days and no downward EPS revisions in the last 30 days. Last quarter, Activision beat average analysts expectations by.05/share, .49/share vs. .44/share.

I always find this a tough period waiting to see if the company is going meet, exceed, or miss their earnings estimates. One thing I have discovered of value is to analyze sentiment moves in a stock ahead of the company’s earnings release. In the case of Activision, I will use the piqqem sentiment index for Activision to see how sentiment has changed in the last quarter, for the months within that quarter, and from the end of the reporting quarter thru today.

I’m looking for moves or changes that may foreshadow the earning release. (piqqem leverages the ‘wisdom of crowds’ by allowing its users to vote on the price direction of a stock and then applies its own propriety factors to calculate sentiment for a security. In their model, -100 is the lowest and 100 is the highest sentiment).

Sentiment for Activision

Click to enlarge

Source Piqqem

Will Activision remain stuck in a trading range like Microsoft (NASDAQ:MSFT) and Electronic Arts (ERTS)? Or is Activision ready to soar with the likes of Walt Disney (NYSE:DIS)?

The above chart shows Activision’s sentiment remaining flat from the beginning of the quarter thru today. As a comparison, sentiment for the Nasdaq index dropped 14 points in the same period, which makes Activision’s strong sentiment even more impressive. On the Piqqem scale, Activision’s sentiment rating of 38.79 is considered a buy and its absolute sentiment indicates a high quality stock. Only Activision knows their actual results, but current sentiment points to the game developer delivering good news on Wednesday.

Disclosure: No positions