This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Activision Levels Up With New Games: Earnings Preview

Stocks in this article: ATVI EA

NEW YORK ( TheStreet) -- Activision Blizzard (ATVI - Get Report) is taking steps to shore up its World of Warcraft franchise as it's done with Call of Duty, leading to strong fourth-quarter earnings released after the stock-market close today.

Sterne Agee analyst Arvind Bhatia shows some concern as Electronic Arts (EA - Get Report) launched Star Wars: The Old Republic in late December. Bhatia believes that may cause a drop in subscribers Activision's massively multi-player online game (MMOG) World of Warcraft.

Bhatia does suggest that the decline in subscribers may be stabilizing, as the company has taken measures by offering free copies of Diablo 3 with a one-year subscription renewal, and 20 free levels to everyone.

"Our view is that while WoW will feel an initial impact from Star Wars, there is potential for both titles to do well. We believe WoW levels at the end of 4Q could have dropped below 10M," Bhatia wrote in a recent research report. He rates shares "buy" with a $17 price target.

Wedbush analyst Michae Pachter notes that Activision continues to trade at a low multiple because of high revenue concentration among Call of Duty and World of Warcraft. "In our view, Elite and Skylanders this year, as well as multiple Blizzard releases and a Bungie game next year should allay some of those concerns," Pachter wrote in research report. He rates shares "outperform" with a $19 price target.

The video-game publisher is expected to report after the close of stock market trading today. Estimates call for revenue of $2.2 billion and earnings of 56 cents per share, according to analysts polled by Thomson Reuters.

Activision shares are off 0.65% in early Thursday trading to $12.47.

Interested in more on Activision Blizzard? See TheStreet Ratings' report card for this stock.

Check out our new tech blog, Tech Trends.

-- Written by Chris Ciaccia in New York

>To follow the writer on Twitter, go to http://twitter.com/commodity_bull.

>To submit a news tip, send an email to: tips@thestreet.com

Check Out Our Best Services for Investors

Action Alerts PLUS

Jim Cramer and Stephanie Link reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

Jim Cramer's protégé, David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
Try it NOW
Try it NOW
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

Jim Cramer's protégé, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 17,451.72 +64.51 0.37%
S&P 500 2,031.47 +1.92 0.09%
NASDAQ 4,697.9180 +16.4210 0.35%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs