This Day On The Street
Continue to site
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

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

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr 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

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

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
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
AAPL $93.38 -0.86%
INTC $29.63 -0.74%
MSFT $49.84 -0.06%
TWTR $14.05 -5.30%
FB $117.25 -0.69%


Chart of I:DJI
DOW 17,660.71 +9.45 0.05%
S&P 500 2,050.63 -0.49 -0.02%
NASDAQ 4,717.0940 -8.5450 -0.18%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs