We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Electronic Arts (EA - Free Report) is a well-known gaming company that develops, markets and publishes game content and services that can be played on consoles, PCs, mobile phones, and tablets. Some of its established brands include FIFA, Madden NFL, Star Wars, Battlefield, The Sims, and Need for Speed.
During the first half of 2018, shares of EA seemed like they could not be stopped, and were up over 36% heading into its first-quarter earnings report.
Its Q1 performance was mixed overall, but EA did beat the Zacks Consensus Estimate on both the top and bottom line; the company noted strong results in its sports franchises, Madden NFL and FIFA. Additionally, digital net bookings were up 13% year-over-year, hitting $3.55 billion.
But, lower-than-expected guidance and a delayed release of Battlefield V, one of its biggest brands, took a huge hit on the stock.
In a press release, CEO and CFO Blake Jorgensen said, "We're updating our fiscal year guidance to reflect the updated launch date for Battlefield V, the ongoing impact of foreign exchange rate changes, and our current outlook for our mobile business."
EA now expects net bookings to be $5.2 billion, down from $5.55 billion; roughly $115 million of this change is driven by foreign exchange rate movements.
With Battlefield V, EA pushed the release date back by a month. There are preliminary reports out suggesting that the game will bring in disappointing sales numbers, especially compared to Activision’s upcoming Call of Duty game and Take Two’s (TTWO - Free Report) Red Dead Redemption 2, two of the most highly-anticipated game releases this fall.
Because of disappointing bookings guidance and the announcement of the Battlefield V delay, 13 analysts lowered their estimates for fiscal 2019. The current consensus has fallen 38 cents from $5.03 to $4.65 in the last 60 days. The outlook for 2020 has fallen as well, down 26 cents during the same time period.
EA is now a #5 (Strong Sell) on the Zacks Rank.
Going forward, it may actually be a good thing for EA to delay the release of Battlefield V from October to November; this will give developers more time to work on it, and fix any big issues.
It’s also important to remember that EA is not dependent on a single game, no matter how much the market is focused on one. EA has a huge, diverse portfolio of core game titles that will be beneficial to it in the long-term.
If you’re an investor looking for a video game stock to add to your portfolio, you may want to consider Glu Mobile Inc. . This global publisher of mobile games is a #2 (Buy) on the Zacks Rank, and currently expects about 157% earnings growth for the year.
5 Medical Stocks to Buy Now
Zacks names 5 companies poised to ride a medical breakthrough that is targeting cures for leukemia, AIDS, muscular dystrophy, hemophilia, and other conditions.
New products in this field are already generating substantial revenue and even more wondrous treatments are in the pipeline. Early investors could realize exceptional profits.
Image: Bigstock
Bear of the Day: Electronic Arts (EA)
Electronic Arts (EA - Free Report) is a well-known gaming company that develops, markets and publishes game content and services that can be played on consoles, PCs, mobile phones, and tablets. Some of its established brands include FIFA, Madden NFL, Star Wars, Battlefield, The Sims, and Need for Speed.
During the first half of 2018, shares of EA seemed like they could not be stopped, and were up over 36% heading into its first-quarter earnings report.
Its Q1 performance was mixed overall, but EA did beat the Zacks Consensus Estimate on both the top and bottom line; the company noted strong results in its sports franchises, Madden NFL and FIFA. Additionally, digital net bookings were up 13% year-over-year, hitting $3.55 billion.
But, lower-than-expected guidance and a delayed release of Battlefield V, one of its biggest brands, took a huge hit on the stock.
In a press release, CEO and CFO Blake Jorgensen said, "We're updating our fiscal year guidance to reflect the updated launch date for Battlefield V, the ongoing impact of foreign exchange rate changes, and our current outlook for our mobile business."
EA now expects net bookings to be $5.2 billion, down from $5.55 billion; roughly $115 million of this change is driven by foreign exchange rate movements.
With Battlefield V, EA pushed the release date back by a month. There are preliminary reports out suggesting that the game will bring in disappointing sales numbers, especially compared to Activision’s upcoming Call of Duty game and Take Two’s (TTWO - Free Report) Red Dead Redemption 2, two of the most highly-anticipated game releases this fall.
Electronic Arts Inc. Price and Consensus
Electronic Arts Inc. Price and Consensus | Electronic Arts Inc. Quote
Because of disappointing bookings guidance and the announcement of the Battlefield V delay, 13 analysts lowered their estimates for fiscal 2019. The current consensus has fallen 38 cents from $5.03 to $4.65 in the last 60 days. The outlook for 2020 has fallen as well, down 26 cents during the same time period.
EA is now a #5 (Strong Sell) on the Zacks Rank.
Going forward, it may actually be a good thing for EA to delay the release of Battlefield V from October to November; this will give developers more time to work on it, and fix any big issues.
It’s also important to remember that EA is not dependent on a single game, no matter how much the market is focused on one. EA has a huge, diverse portfolio of core game titles that will be beneficial to it in the long-term.
If you’re an investor looking for a video game stock to add to your portfolio, you may want to consider Glu Mobile Inc. . This global publisher of mobile games is a #2 (Buy) on the Zacks Rank, and currently expects about 157% earnings growth for the year.
5 Medical Stocks to Buy Now
Zacks names 5 companies poised to ride a medical breakthrough that is targeting cures for leukemia, AIDS, muscular dystrophy, hemophilia, and other conditions.
New products in this field are already generating substantial revenue and even more wondrous treatments are in the pipeline. Early investors could realize exceptional profits.
Click here to see the 5 stocks >>