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Electronic Arts (EA) Gains As Market Dips: What You Should Know
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Electronic Arts (EA - Free Report) closed at $142.61 in the latest trading session, marking a +1.97% move from the prior day. The stock outpaced the S&P 500's daily loss of 0.35%. Meanwhile, the Dow lost 0.41%, and the Nasdaq, a tech-heavy index, lost 0.07%.
Prior to today's trading, shares of the video game maker had gained 16.41% over the past month. This has outpaced the Consumer Discretionary sector's gain of 8.76% and the S&P 500's gain of 3.21% in that time.
EA will be looking to display strength as it nears its next earnings release. On that day, EA is projected to report earnings of $2.94 per share, which would represent year-over-year growth of 5.38%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $2.37 billion, up 20.05% from the year-ago period.
For the full year, our Zacks Consensus Estimates are projecting earnings of $5.46 per share and revenue of $6 billion, which would represent changes of -4.55% and +15.12%, respectively, from the prior year.
Any recent changes to analyst estimates for EA should also be noted by investors. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.
Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. EA is currently sporting a Zacks Rank of #4 (Sell).
Looking at its valuation, EA is holding a Forward P/E ratio of 25.62. This valuation marks a discount compared to its industry's average Forward P/E of 25.94.
It is also worth noting that EA currently has a PEG ratio of 2.2. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Toys - Games - Hobbies industry currently had an average PEG ratio of 2.22 as of yesterday's close.
The Toys - Games - Hobbies industry is part of the Consumer Discretionary sector. This industry currently has a Zacks Industry Rank of 61, which puts it in the top 24% of all 250+ industries.
The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
To follow EA in the coming trading sessions, be sure to utilize Zacks.com.
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Electronic Arts (EA) Gains As Market Dips: What You Should Know
Electronic Arts (EA - Free Report) closed at $142.61 in the latest trading session, marking a +1.97% move from the prior day. The stock outpaced the S&P 500's daily loss of 0.35%. Meanwhile, the Dow lost 0.41%, and the Nasdaq, a tech-heavy index, lost 0.07%.
Prior to today's trading, shares of the video game maker had gained 16.41% over the past month. This has outpaced the Consumer Discretionary sector's gain of 8.76% and the S&P 500's gain of 3.21% in that time.
EA will be looking to display strength as it nears its next earnings release. On that day, EA is projected to report earnings of $2.94 per share, which would represent year-over-year growth of 5.38%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $2.37 billion, up 20.05% from the year-ago period.
For the full year, our Zacks Consensus Estimates are projecting earnings of $5.46 per share and revenue of $6 billion, which would represent changes of -4.55% and +15.12%, respectively, from the prior year.
Any recent changes to analyst estimates for EA should also be noted by investors. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.
Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. EA is currently sporting a Zacks Rank of #4 (Sell).
Looking at its valuation, EA is holding a Forward P/E ratio of 25.62. This valuation marks a discount compared to its industry's average Forward P/E of 25.94.
It is also worth noting that EA currently has a PEG ratio of 2.2. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Toys - Games - Hobbies industry currently had an average PEG ratio of 2.22 as of yesterday's close.
The Toys - Games - Hobbies industry is part of the Consumer Discretionary sector. This industry currently has a Zacks Industry Rank of 61, which puts it in the top 24% of all 250+ industries.
The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
To follow EA in the coming trading sessions, be sure to utilize Zacks.com.