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
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

2013 Tech Predictions: A Ciaccia Look Back


Zynga Gets Acquired

Prediction: Zynga (ZNGA) has had a rough 2012, that's for sure. The company has lost nearly three-quarters of its value, important executives have left the company and Facebook recently distanced itself from the game maker.

CEO Mark Pincus still owns a significant portion of the company (50.15% of the voting rights as of August), despite having sold off significant amounts of stock in the initial public offering and subsequent offering earlier this year.

Zynga, best known for its -Ville games and Words With Friends is trading at extremely cheap levels. It has almost enough cash on hand (about $1.6 billion at the end of the third quarter) to equal its market cap ($1.8 billion). Zynga is still generating cash flow from operations -- $30.1 million in the third quarter -- and it owns a valuable piece of real estate, its San Francisco headquarters.

Pincus retweeted a tweet that said going private should be an option for Zynga. Given the amount of cash it has on hands, it's not out of the realm of possibility to see a management-led buyout on this one.

Review: Well, Zynga didn't get acquired; it's still publicly-traded, so epic fail on that one. However, Mark Pincus stepped down from his position as CEO of the San Francisco-based social gaming company earlier this year, replaced by Don Mattock.

Zynga has still had a tough time of trying to replicate the success it had with Farmville and a few other games, but investors have rewarded the stock this year, sending shares up more than 70% year to date.

Zynga's most recent quarterly results, its third-quarter, still shows the company has a lot of work to do. Revenues fell 36% year-over-year to $203 million, and bookings fell 40% to $152 million.

"We believe our core franchises, Zynga Poker, FarmVille and Words With Friends can be evergreen in terms of consumer interest and we are more effectively resourcing these teams with talent from inside the company," Mattrcik said in his prepared remarks talking about Zynga's third-quarter results. "We are focused on growing these franchises and our teams are showing early progress on better execution, predictability, franchise vision and game quality. Our leaders are working to compete more aggressively and to develop thoughtful growth plans for these core assets in fiscal year '14."

Grade: D (Zynga didn't get acquired, but Pincus did leave. I give myself a smidge of credit, but not much)

3 of 11

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

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
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

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
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, 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
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

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

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
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!
DOW 16,979.13 +59.54 0.35%
S&P 500 1,986.51 +4.91 0.25%
NASDAQ 4,526.4820 -1.0320 -0.02%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

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