Activision Blizzard (NASDAQ: ATVI) shares are trading near an all-time high, and as long the price is above $80, this stock remains in a bull market. Morgan Stanley raised its price target to $108 on Activision Blizzard, while J.P. Morgan expects that the whole sector will increase sales in the upcoming months.
Fundamental analysis: Video game sales jumped to a new record in December, and this trend should continue
Activision Blizzard, Inc. is an American video game holding company with five business units: Activision Publishing, Blizzard Entertainment, King, Major League Gaming, and Activision Blizzard Studios. Activision Blizzard shares are trading near record level, supported by the news that videogame sales jumped to a new record in December.
Activision Blizzard reported Q3 results in the last week of October; total revenue has increased by 46.3% Y/Y to $1.77B while Q3 GAAP EPS was $0.78 (beats by $0.16). Total revenue has risen above the expectations (+$70M), but the company had significantly lower cash flow than expected and a decline in users from Q2.
The company raised its expectations for the full year and expected non-GAAP earnings per share of $3.08 (previously $2.87) and revenues of $7.67B (previously $7.25 billion).
Activision Blizzard is handling the coronavirus threat very well, and it is attracting investors’ attention in this uncertainty on the financial markets. MKM Partners raised its price target on Activision Blizzard to $105 from $100 on expectations for more growth drivers ahead.
“Activision Blizzard remained enthusiastic about growth prospects and attributed the performance to the good execution of Activision Blizzard’s teams. During the lockdown, other forms of entertainment (like sports and movie theaters) remain stalled because of social distancing and shelter-in-place orders during the pandemic. With few other options,
