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Nov. 12, 2015, 2:37 PM
- With just days to its biggest game launch of the year, Electronic Arts (NASDAQ:EA) is up 1% after Oppenheimer initiated coverage at Outperform.
- Star Wars: Battlefront launches on Tuesday with the latest film in the series due in just over a month. And EA boosted some already-strong sales expectations for the game in the fiscal year ending in March: 13M units, up from previous forecasts of 9M-10M.
- EA's games are "the envy of the industry," say Sean McGowan and Christopher Barnes, who have an $83 price target on the stock; that implies 16.4% upside from yesterday's close of $71.30.
- "Rising gross margins and tight cost management have pushed operating margins to near record levels, and we expect sales growth to accelerate," they write. "A strong release slate in the coming quarters and favorable industry trends should drive profit outperformance."
- EA shares are up 15.3% over the past three months and up just short of 75% over the past twelve.
Oct. 30, 2015, 3:18 PM
- Electronic Arts (NASDAQ:EA) has slipped 5% today -- despite a solid quarter for fiscal Q2 where it beat expectations and raised both full-year guidance and sales expectations for its flagship holiday release, Star Wars: Battlefront, not to mention analysts boosting price targets today. What gives?
- For one thing, the stock was at a 52-week high yesterday and some profit takers may be taking advantage of results baked into the stock price. The stock gained 7.1% over the past month.
- And despite holiday sales the coming quarter isn't the easiest one for owners of videogame makers, who face cannibalization from hardware sales, Cowen's Doug Creutz says: "We remain mindful that the November-January seasonal window has historically been a poor time to own the group, and do believe there is a possibility of a short-term pullback after the Star Wars launch."
- But even he goes on to say "However, with both Battlefield 5 and Titanfall 2 likely on the docket for FY17, as well as another potential Star Wars title, we believe the company can continue its robust growth trajectory."
- EA expects Battlefront to move 13M units in the rest of the fiscal year (until March), up from a previous forecast of 9M-10M.
- The stock's trading now at $72.27. Mizuho raised its price target to $84, from $75, implying 16.2% upside, and MKM raised its target to $84, from $82.
- Previously: EA -2.6% after solid fiscal Q2 beat, raised guidance (Oct. 29 2015)
Oct. 29, 2015, 4:13 PM
- Electronic Arts (NASDAQ:EA) jumped briefly but are now down 2.6% in postmarket trading following a solid beat in its fiscal second quarter during which it bumped its full-year guidance yet again.
- Net revenues for live services including FIFA, Madden NFL and Hockey Ultimate Team are up 64% Y/Y combined. For the trailing 12 months, non-GAAP net revenue hit $4.163B (a record $2.307B in digital).
- Expectations are high for the holiday quarter, which will feature Star Wars: Battlefront. The company raised guidance for non-GAAP net revenue of $1.775B (high of an expected $1.75B) and EPS of $1.75 vs. an expected $1.73.
- For the fiscal year, the company sees non-GAAP net revenues of $4.5B (vs. expected $4.54B), and EPS of $3.00 (higher than an expected $2.96).
- Conference call to come at 5 p.m. ET.
Oct. 29, 2015, 4:04 PM
- Electronic Arts (NASDAQ:EA): FQ2 EPS of $0.65 beats by $0.20.
- Revenue of $1.15B (-5.7% Y/Y) beats by $50M.
- Shares +3.2%.
Oct. 28, 2015, 5:35 PM
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Oct. 27, 2015, 4:05 PM
- Electronic Arts (NASDAQ:EA) has picked up 1.6% today, and got close to another 52-week high, after Piper Jaffray reiterated its Buy rating ahead of the company's Thursday earnings report.
- Analyst Mike Olson maintained an $86 price target; shares have closed at $75.27, implying 14.3% upside.
- He's looking for "potential for upside to results driven by FIFA sales in Europe and growth of digital revenue." A tough comparison in NPD sales for September came due to FIFA results (FIFA 16 declined compared to FIFA 15 -- counting U.S. only). And NPD doesn't count titles bundled with hardware or full-game digital downloads, which presents some possible upside for FIFA Ultimate Team.
- Guidance could see a boost: "EA may slightly raise FY16 guidance, with comps easing in 2H2016 and the launch of Star Wars: Battlefront in November," he says.
Oct. 20, 2015, 12:08 AM
- Videogame sales tumbled in September, NPD Group says, falling 9% to $1.01B, with holiday promotions seemingly just around the corner.
- Once again, both hardware and software declined, though hardware took the beating -- down 27% to $313.5M -- as many gamers may be awaiting a console price break or bundle in time for holiday shopping. Software sales fell just 3% by comparison, to $465.6M. Accessory sales rose again.
- In new games at retail, Metal Gear Solid V: The Phantom Pain (OTCPK:KNMCY) couldn't unseat either NBA 2K16 (NASDAQ:TTWO) or Madden NFL 16 (NASDAQ:EA), which finished September with a one-two punch, and settled at third place, just ahead of FIFA 16 (EA). Rounding out EA's sports-title success, NHL 16 debuted at No. 9.
- The only single-platform exclusive to make that top 10 was Super Mario Maker (OTCPK:NTDOY), which debuted at No. 6.
- Once again, Sony (NYSE:SNE) confirmed the PlayStation 4 was the top console, outselling the Xbox One (NASDAQ:MSFT) and Wii U. Sony's box has outsold Xbox One every month this year except April.
- But the hardware faced a tough comp against last year's sales, buttressed by the release of Destiny (NASDAQ:ATVI), says NPD's Liam Callahan. And he notes that the consoles are trending up M/M: “All eighth generation consoles [which includes PS4, Xbox One, and Wii U] experienced double-digit growth when comparing sales on a per-week basis.”
Oct. 14, 2015, 9:15 PM
- Demand is still strong among teens for the newest generation of videogame consoles, Piper Jaffray says -- and that's good news for leading game makers like Activision Blizzard (ATVI +0.4%) and Electronic Arts (EA +3.1%).
- Uptake of the Xbox One (MSFT -0.5%) and PlayStation 4 (SNE -1.5%) consoles "is at the highest level we have seen, reinforcing our expectation for a much more rapid pace than prior-gen" consoles, says analyst Michael Olson, a "clear positive" for Activision, EA, Take-Two Interactive (TTWO +0.2%) and retailer GameStop (GME -1.1%).
- The firm's semiannual survey found 73% of videogame-playing teens own an Xbox One or PlayStation 4, or intend to get one -- up from 70% last spring and 67% last fall. Some 39% currently own one of the newer consoles, up from 37% in the spring and 26% last fall.
- "We believe the combination of next-gen console uptake and a robust lineup of AAA titles will lead to sustainable software growth through second-half 2015 and into 2016," Olson writes.
- Mobile players are stable, but the number who'll pay is rising as well. Some 24% of teens who play mobile games by makers like Glu Mobile (GLUU +1.2%) and King Digital (KING -0.4%) say they spend in-game money, the survey said, up from 21% in the spring.
Oct. 14, 2015, 4:14 PM
- Electronic Arts (NASDAQ:EA) moved up this afternoon to finish up 3.1% as MKM Partners upgraded to Buy on a look at the upcoming lineup and stronger margins.
- Analyst Eric Handler has an $82 price target; that's 16% upside from today's close.
- Handler's got a Buy rating even after the stock's doubling over the past year. He raised his outlook after a "record turnout" of 9M players for the beta of Star Wars: Battlefront, but there's a strong development slate ahead as well: a new Battlefield from Dice, Mass Effect: Andromeda, and Titanfall 2, to add on to the Star Wars content.
- Margin expansion "remains healthy," Handler says, and should keep growing to 71.5% from the prior 71%. He's raised EPS estimates for Q3 to $1.82, from $180, and Q4 estimates to $0.58, from $0.54.
Oct. 7, 2015, 8:14 PM
- Good news for Activision Blizzard (NASDAQ:ATVI) in the Nielsen Game Rank study, as its Call of Duty: Black Ops 3 is the most anticipated multiplatform video game for the holiday season.
- The game got a 98% rating in the Nielsen study, which measured overall anticipation for games to be released in Q4.
- Tied for second place were Fallout 4 from Bethesda Softworks and Ubisoft's (OTCPK:UBSFY +1.8%) Assassin's Creed: Syndicate, each at 95%.
- Eagerly awaited Star Wars: Battlefront, from Electronic Arts (EA -0.7%), was a surprising fifth place with 88% behind EA's new Need for Speed title at 92%.
- Among console exclusives, the top rankers vary: For the Xbox One, it's Microsoft's (NASDAQ:MSFT) Halo 5: Guardians (100%). For the PS4 (NYSE:SNE), Uncharted: The Nathan Drake Collection (79%). For Nintendo's (OTCPK:NTDOY) Wii U, it's Yoshi's Woolly World (91%).
Sep. 18, 2015, 7:52 AM
- The Nevada Gaming Commission approved a set of rules to allow a new category of games which mix skill and chance.
- The aim of industry players is to introduce hybrid slot machines which appeal to millennials by incorporating skills such as knowledge of trivia, strategic thinking, or dexterity. Traditional slot machines haven't been popular with millennials in general.
- Related stocks: CZR, WYNN, SGMS, ISLE, PNK, PENN, MCRI, CNTY, IGT, MGM, BYD, OTCQB:TPCA, ATVI, TTWO, EA.
- Related ETFs: BJK
Sep. 11, 2015, 5:27 PM
- Videogame sales slipped in August, despite the "annual Madden," with new physical games and hardware down 2% to $548M, according to NPD Group.
- That's due to a bigger decline in software sales, though hardware slipped as well. Game sales fell 10% to $207.9M on tough comps against last year's Diablo III console launch and Sony's The Last of Us.
- Spending on hardware dropped a comparatively lighter 2% to $190.5M. Accessory sales rose, however, up 12% to $150M. Current-gen consoles rose to 68% of software sales from the prior month's 61%, according to Piper Jaffray.
- Madden NFL 16 (EA +0.3%) was the unsurprising leader in software for August after its late-month release, ahead of a pair of Microsoft (MSFT +0.4%) titles, Minecraft and Gears of War: Ultimate Edition.
- “New physical software sales for [Xbox One and PS4] consoles, up 34%, did not offset the 51% decline in [last] generation console sales as well as the 24% drop in portable software sales,” said NPD analyst Liam Callahan.
- Piper's Michael Olson reiterated Overweight ratings on Activision Blizzard (ATVI +0.3%), EA and Take-Two (TTWO +0.1%), as well as on GameStop (GME +1%). "We expect that 2015 and 2016 will be the equivalent to 2007 and 2008 during the prior console cycle," he writes; "both were years that experienced significant industry software growth, following several years of decline or limited growth in the space."
- Meanwhile, Sony (SNE +0.9%) confirmed its PlayStation 4 outsold competing hardware from Microsoft and Nintendo (OTCPK:NTDOY -1.5%) yet again in August.
Sep. 2, 2015, 7:56 PM
- The buildup to Star Wars' "Force Friday" is under way, with Walt Disney's (NYSE:DIS) 18-hour toy rollout having kicked off a short time ago via its live YouTube channel.
- It began in the morning local time in Sydney, with a custom lightsaber-building toy kit from Hasbro. Eighteen hours is a long time for opening 15 toys, though, so there's a bit of a lull until the Tokyo unboxing at 10 p.m. ET (schedule).
- "Force Friday" is an all-out promotional effort, coming more than three months before Star Wars: The Force Awakens (the film) bows. The merch will likely add hundreds of millions of dollars to Disney's 2016 revenues, leading up to another film in December 2016.
- The lead manufacturer of the toys is Hasbro (NASDAQ:HAS), and other producers include Electronic Arts (NASDAQ:EA), collectible-card company Topps, Lego, Rubie's Costumes and Tobar novelties.
- Previously: Disney Infinity 3.0 launches with 'Star Wars' characters (Aug. 31 2015)
- Previously: Disney up 2.8%; schedules 18-hour YouTube 'Star Wars' toy rollout (Aug. 26 2015)
Aug. 25, 2015, 5:35 PM
- investors should stick with "market darlings" - the 25 stocks that had performed the best during the six months before a market pullback - according to the analyst team at RBC.
- The firm notes that although many recent winners are leading the market lower, the extent of the underperformance is just 1%; it also says investing in the group following sharp market pullbacks is a winning strategy over the ensuing week, month and six months.
- RBC's 25 market darlings are AET, ALTR, AMZN, AIZ, CVC, CI, CAG, EA, EQIX, EXPE, GME, GOOGL, HAS, HCA, MNST, NFLX, NKE, PRGO, REGN, SBUX, TSO, TWC, TSS, UA, UHS
Aug. 10, 2015, 11:45 AM
- Activision Blizzard (NASDAQ:ATVI) is up 0.5%, and Electronic Arts (NASDAQ:EA) up 1%, as Piper Jaffray raises price targets on both in a bullish report on game growth driven by next-generation consoles.
- EA's target was raised to $85; shares closed Friday at $73.36 and are currently trading at $74.04, implying near 15% upside. The firm raised its target on Activision to $33, from $30; shares closed Friday at $28.78 and are currently trading at $28.93, implying 14% upside.
- Piper's Michael Olson thinks 2015-2016 could be the match for 2007-2008 in the last console cycle: "Both were years that experienced significant industry software growth, following several years of decline or limited growth in the space. This is positive for video game publishers."
- Activision Blizzard's guidance looked "conservative," he says, as the company heads into a second half with new entries for its brands Skylanders, Call of Duty and Destiny as well as its Guitar Hero reboot.
Jul. 30, 2015, 4:28 PM
- Electronic Arts (NASDAQ:EA) is off 4% now in after-hours trade following a strong quarter where it raised full-year guidance and beat expectations on top and bottom lines despite revenues that slipped more than 10% from last year.
- Revenue breakout: Total non-GAAP net revenue of $693M was composed of digital net revenue of $532M (up 10.3%) and packaged goods and other revenue of $161M (down 45%). On a GAAP basis, digital net revenue of $623M and packaged goods and other revenue of $580M came to GAAP revenue of $1.2B, down about 1%.
- Monthly active users averaged more than 150M for the quarter. The company noted that during E3 week, EA titles earned 132 awards and trailers, gameplay and livestreams were viewed more than 53M times.
- The company guided for full fiscal year (ending March 31, 2016) non-GAAP net revenues of $4.45B and EPS of $2.85, up from $2.75. For its fiscal Q2, the company sees revenue of $1.075B (light of an expected $1.12B) and EPS of $0.40 vs. an expected $0.66.
- Conference call to come at 5 p.m. ET.
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