Multi-decade highs for Activision post-earnings; EA, Take-Two also rise


More than two decades have passed since Activision (ATVI +14.4%) last traded at current levels, as a Q4 beat,  slight dividend hike, World of Warcraft subscriber growth, and game pipeline enthusiasm took precedence over below-consensus 2014 guidance.

Rivals Electronic Arts (EA +2.8%) and Take-Two (TTWO +2.2%) joined in on the fun. Shares of both companies are roughly $1 removed from their respective 52-week highs.

BofA/Merrill's Justin Post notes Activision has a history of issuing conservative full-year guidance to start the year, and considers the WoW sub growth a pleasant surprise.

Wedbush's Michael Pachter is upbeat about a 2014 pipeline that includes updates to WoW and Diablo III, and the launch of anticipated open world first-person shooter Destiny. He thinks the game could produce $500M or more in sales following its September release.

Activision stated on its CC (transcript) it thinks Destiny could be its third billion-dollar franchise (after Call of Duty and Skylanders), and that it's moving to a 3-year development cycle for Call of Duty titles (three studios take turns launching titles) to allow for better game development.

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