How Analysts View EA After Earnings

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Electronic Arts Inc. (NASDAQ: EA) reported fiscal second-quarter financial results after markets closed on Tuesday. This leading video game developer has benefited from not only the continuing rise in new console sales, but also the rising trend of mobile gaming. This week’s¬†earnings report reflected this, and across the board analysts raised their targets in response.

24/7 Wall St. has included a few highlights from the actual earnings report, as well as what analysts are saying after earnings were released.

The company said that it had a net loss of $0.13 per share and $898 million in revenue, not including a change in deferred revenue of $200 million. The consensus estimates from Thomson Reuters had called for $0.43 in earnings per share (EPS) and $1.09 billion in revenue. The same period of last year reported had $0.65 in EPS and $1.15 billion in revenue.

It is worth mentioning that these results may look significantly different from the consensus estimates, but the company is moving toward reporting on an all-GAAP basis while most estimates are non-GAAP.

Battlefield 1 total player base for the first week was nearly double that of Battlefield 4, and it is continuing to grow.

Net sales from FIFA, Madden NFL and Hockey Ultimate Team are collectively up 15% for the trailing 12 months, compared to last year. Also FIFA Mobile reached number one on the App Store Free Games chart in 138 countries.

In terms of guidance for the fiscal third quarter, the company expects to have a net loss per share of roughly $0.17 and for net revenue to be $1.125 billion.

A few analysts weighed in on EA after earnings were announced:

  • MKM Partners reiterated a Buy rating with a $95 price target.
  • Barclays reiterated an Overweight rating and raised its target price to $94 from $88.
  • Piper Jaffray reiterated it as Overweight and raised the price target to $91 from $89.
  • Credit Suisse reiterated an Outperform rating with a $100 price target.
  • Morgan Stanley reiterated an Overweight rating with a $101 price target.
  • Wedbush has a Buy rating and raised its price target to $95 from $92.
  • Robert Baird reiterated it at Outperform and raised its price target to $91 from $83.
  • Mizuho has a Neutral rating but raised its price target to $92 from $84.

Shares of EA were last trading at $80.22 on Friday, with a consensus analyst price target of $92.29 and a 52-week trading range of $53.01 to $86.07.