Zynga higher on CFO change, Morgan Stanley upgrade


Zynga's (ZNGA +1.4%) FarmVille 2: Country Escape better aligns game monetization with engagement than past titles, says Morgan Stanley's John Egbert, upgrading shares to Equal-weight.

Egbert points to healthy Canadian/Australian soft launches as a reason to be optimistic about Country Escape, the first title for Zynga's most lucrative franchise to launch on mobile. He thinks it could be be a top-20 grossing mobile app following its Q2 U.S. launch.

Egbert also expects Zynga to start post Q/Q bookings and DAU growth after many quarters of huge declines (the NaturalMotion deal should provide a lift), and thinks its will exit 2014 with 50% Y/Y organic bookings growth.

Zynga is counting on Country Escape to halt FarmVille 2's big share losses. AppData estimates the game has lost nearly half of the 8M Facebook DAUs it had in March 2013. Over the same time, Candy Crush Saga (KING -3%) more than doubled its Facebook app DAU share to 15.8% from 7.3% (in spite of recent softness).

Zynga is higher thanks to the upgrade and yesterday's CFO change announcement.

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Comments (2)
  • Big97cw
    , contributor
    Comment (1) | Send Message
     
    Zynga
    +1.2BB in Cash
    +No Debt
    +New Experienced Management with a long track record
    =No Brainer
    11 Apr 2014, 02:00 PM Reply Like
  • haleiwahu
    , contributor
    Comments (4000) | Send Message
     
    So how does Z's hype on value increase when their DAU & MAU continue to drop? http://bit.ly/1hsdVca
    11 Apr 2014, 10:08 PM Reply Like
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