While technology remains a favorite sector on Wall Street for 2016, many companies posted less than thrilling first quarter numbers. Clearly the two big winners were Facebook Inc. (NASDAQ: FB) and Amazon.com, Inc. (NASDAQ: AMZN), but for many investors, the share prices of the two tech giants are out of their price range, and shares may be better owned in an exchange traded fund (ETF) or a mutual fund. The question becomes what tech stocks that reported good earnings are reasonable for investors with less capital?
One firm that addressed that question is West Coast boutique regional Wedbush. In fact they even had a recent research report focusing on tech stocks to buy after earnings, aside from Facebook and Amazon, both of which they also like. The firm listed five top companies they preferred, and we focus on three of the bigger and more liquid picks.
This company reported very solid first-quarter quarter results and remains a top pick on Wall Street. Activision Blizzard Inc. (NASDAQ: ATVI) develops and publishes online, personal computer (PC), video game console, handheld, mobile and tablet games worldwide.
The company develops and publishes interactive entertainment software products through retail channels or digital downloads and downloadable content to a range of gamers. The company’s Call of Duty franchise, which has propelled earnings for this industry powerhouse for years lead a strong product inventory along with other favorites like Skylanders and Guitar Hero.
The big news last fall was the company’s purchase of Candy Crush saga creator King Digital Entertainment, and most of Wall Street think the buy is an outstanding move for the company and specifically the synergies between the two companies is 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.
The Wedbush team feels that the company could earn up to $3 per share by 2018 if it can optimize the King Digital advertising opportunities and unlock synergies.
Shareholders are paid a small 0.67% dividend. The analyst raised the price target to $43 from $40, and the Thomson/First Call consensus price target is lower at $42.02. The stock closed most recently at $38.95.