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Electronic Arts ( EA ) stock rocketed higher on Wednesday, a day after the video game publisher reported better-than-expected March-quarter earnings, thanks to hot games like “Star Wars Battlefront.” EA stock was up 12%, near 72.50, in afternoon trading on the stock market today . The stock is at its loftiest point since touching an all-time intraday high of 76.92 on Oct. 29. The Redwood City, Calif.-based company said late Tuesday it earned 50 cents a share excluding items on sales of $924 million in its fiscal fourth quarter ended March 31. Analysts polled by Thomson Reuters had expected EA to earn 42 cents a share on sales of $889 million. On a year-over-year basis, adjusted EPS rose 28%, and revenue inched up 3%. “We grew non-GAAP net revenue, profitability and cash flow to record highs,” Chief Financial Officer Blake Jorgensen said in a statement . “Leveraging our great portfolio of brands and live services has enabled us to break records across our key financial metrics. We expect to drive strong revenue, earnings and cash flow growth into the future.” EA credited “Star Wars Battlefront” and sports games, such as “Madden NFL 16″ and “FIFA 16,” for its gains in Q4. For its current fiscal 2017, EA expects to earn $3.50 a share excluding items on sales of $4.9 billion. That compares with fiscal 2016 results of $3.14 EPS on sales of $4.57 billion. EA hopes to continue its strong performance with new games this year, such as “Mirror’s Edge Catalyst,” due out June 7, and “Battlefield 1,” set for release Oct. 21. Also in the pipeline are “Titanfall 2,” scheduled for fiscal Q3, and “Mass Effect: Andromeda,” set for late Q4. New Star Wars Games Coming From EA Jefferies analyst Brian Pitz maintained his buy rating on EA stock but raised his price target to 105 from 95. “We continue to believe EA is poised to benefit from numerous multiyear tailwinds, including fast sales of consoles and ever more direct-to-consumer digital downloads, which drive improved profitability,” Pitz said in a report. Benchmark analyst Mike Hickey also reiterated his buy rating on EA and inched up his price target to 82.64 from 81.48. Key factors driving his enthusiasm for the company include expectations for continued sales and earnings growth, a compelling game slate ahead and growth of digital downloads and services, Hickey said. Wedbush analyst Michael Pachter reiterated his outperform rating on EA and 12-month price target of 86. “The company provided greater visibility into its long-term release schedule, expecting to launch at least one Star Wars title each year over the next three to four years,” he said in a report. “In fiscal 2018, it expects to launch a Star Wars Battlefront sequel. “In fiscal 2019, it expects to launch a Star Wars action game from Motive Studios and Visceral Games. It also expects to launch a Star Wars game from Respawn Entertainment, which we have penciled in for fiscal 2020. In addition to its Star Wars efforts, EA expects to launch a new, unannounced IP (intellectual property) in fiscal 2018.” Last week, Activision Blizzard ( ATVI ) reported better-than-expected first-quarter sales and earnings , thanks to a boost from newly acquired mobile game publisher King Digital Entertainment. A third major video game publisher, Take-Two Interactive Software ( TTWO ), is scheduled to report fiscal-fourth-quarter earnings on May 18. Scalper1 News
Scalper1 News