What to Expect From Activision Blizzard Earnings

May 5, 2016 by Chris Lange

Activision Blizzard Inc. (NASDAQ: ATVI) is scheduled to release its most recent earnings report after the markets close on Thursday. The consensus estimates from Thomson Reuters call for $0.12 in earnings per share on revenue of $812.12 million. In the same period of last year, the company posted EPS of $0.16 and $703.00 million in revenue.

Activision reported very mixed fourth-quarter results, but remains a top pick with some analyst firms. The company develops and publishes online, personal computer (PC), video game console, handheld, mobile and tablet games worldwide. It develops and publishes interactive entertainment software products through retail channels or digital downloads to a range of gamers.

The company’s Call of Duty franchise has propelled earnings for this industry powerhouse for years. “Call of Duty: Black Ops 3” was one of the top-selling games in the Christmas selling period, and its newest installment, “Call of Duty Infinite Warfare,” is scheduled for release later this year (November 4) just in time for the holidays.

The big news last fall was the company’s purchase of Candy Crush creator King Digital Entertainment. Most on Wall Street think the buy was an outstanding move for the company, and specifically the synergies between the two companies have been cited. Many analysts feel that the key to unlocking some monster value is creating and cross-promoting the Activision product inside the King Digital mobile distribution network.

A few analysts weighed in on the company prior to the impending earnings report:

  • Wedbush reiterated an Outperform rating with a $40 price target.
  • MKM has a Buy rating with a $38 price target.
  • BMO Capital Markets initiated coverage with a Market Perform rating.
  • Piper Jaffray reiterated a Buy rating.

So far in 2016, Activision Blizzard has underperformed the broad markets, with the stock down about 10% year to date. Over the past 52 weeks, the stock is up over 50%.

Shares of Activision Blizzard were trading up 2.4% to $35.08 on Thursday, with a consensus analyst price target of $38.43 and a 52-week trading range of $23.13 to $39.93.

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