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Videogame Stock Roundup: SINA, Sohu, Changyou Earnings in Focus; Nintendo Gears Up for Switch Launch
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Earnings releases were once again in focus this week. These apart, Japanese giant Nintendo (NTDOY - Free Report) is preparing for the release of its latest Console, Switch.
Recap of the Developments
1. Earnings:
SINA Corp : SINA reported fourth-quarter 2016 adjusted earnings of 27 cents per share, which came in line with the Zacks Consensus Estimate but improved 28.6% from the year-ago quarter. Net revenue of $313.4 million topped the Zacks Consensus Estimate of $307.7 million and increased 22.3% year over year. The company posted non GAAP earnings of 63 cents per share, up 80% year over year.SINA carries a Zacks Rank#3 (Hold).
Sohu.com Inc. (SOHU - Free Report) : Sohu reported fourth-quarter 2016 non-GAAP loss of $1.79 per share, compared with a loss of $1.68 reported in the prior-year quarter. Sohu’s revenues of $412 million decreased 12% on a year-over-year basis due to lower revenues from advertising and online gaming. Online game revenues for the quarter plunged 25% year over year to $95 million. Sohu carries a Zacks Rank #3 (Hold).You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Changyou.com Ltd. : Changyou reported adjusted third-quarter 2016 earnings of 77 cents per share that topped the Zacks Consensus Estimate of 61 cents. The company reported revenues of $130.5 million, down 19.4% year over year. Online game revenues came in at $95 million, down 25% year over year. Online advertising revenues declined 44% year over year to $8 million. Changyou.com carries a Zacks Rank #3.
2. Meanwhile, Japanese giant Nintendo is gearing for the release of its highly anticipated console, Switch on Mar 3. Switch combines the functionalities of both conventional consoles and handheld devices. Switch is designed to attract casual gamers who are more inclined towards mobile. Nintendo after staying away from mobile gaming for long has now become highly focussed on mobile games. Last year’s smash hit Pokémon Go gave it the much needed impetus.
Analysts observe that Nintendo needs a hit in the form of Switch, following the debacle of its last console Wii U. But the apparent lack of any ground-breaking/differentiating features from the consoles that are available in the markets right now could cost Nintendo heavily. Plus, analysts were expecting a lower price tag for Switch compared to Wii U, PS4 and Xbox One. The hefty $299 price tag may become a deterrent going ahead per analysts. Nintendo carries a Zacks Rank #3.
Over the past one year, the success of Pokémon Go has cushioned its share price, which is up 42.09% compared with the Zacks Toys/Games/ Hobby/Products industry’s gain of 28.92%.
Performance
The following table shows the price movement of the major video game companies over both the past five trading days as well as the last six months:
Company
Last 5 Days
Last 6 Months
ATVI
-4.55%
10.93%
EA
0.56%
5.27%
GLUU
-6.10%
-11.89%
MSFT
0.97%
11.63%
NTES
16.15%
40.26%
TTWO
-0.05%
36.92%
ZNGA
5.04%
1.88%
Over the last five trading sessions, Glu Mobile Inc. was down 6.10% whereas NetEase Inc. (NTES - Free Report) was up 16.15%.
Over the last six-month period, NetEase surged the most (40.26%). Recently, NetEase reported solid fourth-quarter 2016 results. The increasing popularity of mobile-based games and the strength of PC games (licensed & self-developed) continue to keep investors interested in the stock. NetEase’s online gaming revenues grew 62% in the quarter. Also, NetEase has announced a new $1 billion buyback program for its ADRs over a one-year time frame.
Glu was down 11.89% over the same time frame owing to underperformance of most of its releases. To improve its performance, Glu announced it has inked a deal with MLB and Kris Bryant and many more for releasing a new title under its Tap Sports Baseball franchise. The company brought on board, a video game industry veteran Nick Earl as the new CEO while Niccolo de Masi will now be the chairman of the company. It also acquired a majority stake in CrowdStar, which develops free-to-play mobile games. It recently acquired a mobile game developer, Plain Vanilla for $7.5 million.
Want to learn more about video game stocks? Make sure to check out our podcast below!
Zacks' Top 10 Stocks for 2017
In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-hold tickers for the entirety of 2017?
Who wouldn't? Last year's market-beating Top 10 portfolio produced 5 double-digit winners. For example, oil and natural gas giant Pioneer Natural Resources and First Republic Bank racked up stellar gains of +44.9% and +44.3% respectively. Now a brand-new list for 2017 has been hand-picked from 4,400 companies covered by the Zacks Rank. See the 2017 Top 10 right now>>
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Videogame Stock Roundup: SINA, Sohu, Changyou Earnings in Focus; Nintendo Gears Up for Switch Launch
Earnings releases were once again in focus this week. These apart, Japanese giant Nintendo (NTDOY - Free Report) is preparing for the release of its latest Console, Switch.
Recap of the Developments
1. Earnings:
SINA Corp : SINA reported fourth-quarter 2016 adjusted earnings of 27 cents per share, which came in line with the Zacks Consensus Estimate but improved 28.6% from the year-ago quarter. Net revenue of $313.4 million topped the Zacks Consensus Estimate of $307.7 million and increased 22.3% year over year. The company posted non GAAP earnings of 63 cents per share, up 80% year over year.SINA carries a Zacks Rank#3 (Hold).
Sohu.com Inc. (SOHU - Free Report) : Sohu reported fourth-quarter 2016 non-GAAP loss of $1.79 per share, compared with a loss of $1.68 reported in the prior-year quarter. Sohu’s revenues of $412 million decreased 12% on a year-over-year basis due to lower revenues from advertising and online gaming. Online game revenues for the quarter plunged 25% year over year to $95 million. Sohu carries a Zacks Rank #3 (Hold).You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Changyou.com Ltd. : Changyou reported adjusted third-quarter 2016 earnings of 77 cents per share that topped the Zacks Consensus Estimate of 61 cents. The company reported revenues of $130.5 million, down 19.4% year over year. Online game revenues came in at $95 million, down 25% year over year. Online advertising revenues declined 44% year over year to $8 million. Changyou.com carries a Zacks Rank #3.
2. Meanwhile, Japanese giant Nintendo is gearing for the release of its highly anticipated console, Switch on Mar 3. Switch combines the functionalities of both conventional consoles and handheld devices. Switch is designed to attract casual gamers who are more inclined towards mobile. Nintendo after staying away from mobile gaming for long has now become highly focussed on mobile games. Last year’s smash hit Pokémon Go gave it the much needed impetus.
Analysts observe that Nintendo needs a hit in the form of Switch, following the debacle of its last console Wii U. But the apparent lack of any ground-breaking/differentiating features from the consoles that are available in the markets right now could cost Nintendo heavily. Plus, analysts were expecting a lower price tag for Switch compared to Wii U, PS4 and Xbox One. The hefty $299 price tag may become a deterrent going ahead per analysts. Nintendo carries a Zacks Rank #3.
Over the past one year, the success of Pokémon Go has cushioned its share price, which is up 42.09% compared with the Zacks Toys/Games/ Hobby/Products industry’s gain of 28.92%.
Performance
The following table shows the price movement of the major video game companies over both the past five trading days as well as the last six months:
Company
Last 5 Days
Last 6 Months
ATVI
-4.55%
10.93%
EA
0.56%
5.27%
GLUU
-6.10%
-11.89%
MSFT
0.97%
11.63%
NTES
16.15%
40.26%
TTWO
-0.05%
36.92%
ZNGA
5.04%
1.88%
Over the last five trading sessions, Glu Mobile Inc. was down 6.10% whereas NetEase Inc. (NTES - Free Report) was up 16.15%.
Over the last six-month period, NetEase surged the most (40.26%). Recently, NetEase reported solid fourth-quarter 2016 results. The increasing popularity of mobile-based games and the strength of PC games (licensed & self-developed) continue to keep investors interested in the stock. NetEase’s online gaming revenues grew 62% in the quarter. Also, NetEase has announced a new $1 billion buyback program for its ADRs over a one-year time frame.
Computer and Technology Sector 5YR % Return
Computer and Technology Sector 5YR % Return
Glu was down 11.89% over the same time frame owing to underperformance of most of its releases. To improve its performance, Glu announced it has inked a deal with MLB and Kris Bryant and many more for releasing a new title under its Tap Sports Baseball franchise. The company brought on board, a video game industry veteran Nick Earl as the new CEO while Niccolo de Masi will now be the chairman of the company. It also acquired a majority stake in CrowdStar, which develops free-to-play mobile games. It recently acquired a mobile game developer, Plain Vanilla for $7.5 million.
Want to learn more about video game stocks? Make sure to check out our podcast below!
Zacks' Top 10 Stocks for 2017
In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-hold tickers for the entirety of 2017?
Who wouldn't? Last year's market-beating Top 10 portfolio produced 5 double-digit winners. For example, oil and natural gas giant Pioneer Natural Resources and First Republic Bank racked up stellar gains of +44.9% and +44.3% respectively. Now a brand-new list for 2017 has been hand-picked from 4,400 companies covered by the Zacks Rank. See the 2017 Top 10 right now>>