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Zynga Cracks $5 and Starts Luring Bulls

Some may attribute to the forthcoming IPO of King Digital Entertainment -- makers of Candy Crush -- as the catalyst for Zynga's rise this week. A spotlight focused directly on online game markers helps, but it's only one more log on the fire. Candy Crush doesn't fully explain the move in Zynga from $3.50, although it may have improved investor sentiment.

Announcing new real-money mobile slots games -- including Riches of Olympus -- should excite investors more. Zynga is licensed by the U.K. to offer online slots, poker and other games of chance.

I'm fully convinced the U.K. is a warm-up to offering online gambling to other parts of the world. Investors are beginning to realize that the company is transitioning away from a struggling "freemium" model -- a free game with added features offered for cash. Freemium games are vulnerable to the whims of Facebook (FB). But Zynga is working to become a real-money online poker powerhouse on a level playing field with Facebook and every other web property.

More importantly to shareholders, as investors realize this change is afoot, shares should continue their climb higher.

At the time of publication, the author was long Zynga but held no positions in any of the other stocks mentioned.

This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff.

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